Underpass lot below Interstate 10 failed inspection months before fire

The piles of wooden pallets stored with combustible liquids under Interstate 10 had been troubling Caltrans and state fire officials for at least three years before the materials went up in flames this month and caused the closure of one of Los Angeles’ busiest freeways for more than a week, documents newly released from Caltrans show.

The fire is now being investigated as arson. It also put a spotlight on the little-known $34.6-million Caltrans lease program that allows private companies to rent out space underneath and next to freeways. Standing atop the Santa Monica Freeway early Sunday morning, Gov. Gavin Newsom said he expects to have on Wednesday an early statewide assessment of the program, which has more than 600 leases.

The fire prompted federal authorities to remind state transportation departments about federal regulations that limit the storing of flammable materials under highway bridges.

“This event in California again raises serious concerns about storing materials, including flammable, explosive, or hazardous materials, under bridges and other elevated structures,” Federal Highway Administration officials wrote in a memo to state departments of transportation last week. They cited warnings from the National Transportation Safety Board about being vigilant for combustible materials under bridges after a similar 2017 fire shut down a stretch of I-85 in Atlanta.

Caltrans has leased the underpass where the fire erupted to Apex Development and its owner Ahmad Anthony Nowaid since 2008 but recently had been trying to evict him for failure to pay rent.

Nowaid subleased the parcel to nearly a dozen businesses that operated inside the 48,000-square-foot area, charging them in total about three times what he was paying, according to court documents and tenants. Many of the renters were immigrants who ran blue-collar shops, including a pallet distributor, a mechanic shop and a recycler.

Several said they had seen inspectors and tried to comply with any requests.

“What we do is try to have our workplace as safe as we can,” said Raul Castro, who buys cars for scrap metal. “We try to have it clean with no flammable stuff, nothing at all.”

Caltrans said it inspected the underpass location at Lawrence and East 14th streets six times since early 2020, with the most recent inspection having occurred on Oct. 5. During those visits, inspectors noted several fire hazards including wooden pallets and the homeless encampments that surrounded the lot.

In September 2021, Caltrans officials sent a letter to Nowaid informing him of “numerous violations regarding the storage of hazardous materials,” according to the documents. Inspector Daryl Myatt said a foreman, Matthew Herrera, promised that the safety hazards would be cleaned up by the next month.

They never were.

Apex failed a surprise inspection by Caltrans and the Office of the State Fire Marshal on Aug. 16, 2022.

“This lease has numerous violations of lease terms including dogs on lease, multiple high pile issues, solvents, oils, fuels and other things expressly prohibited by the lease,” Myatt wrote in a Caltrans log of the inspection.

“This is a filthy unmaintained lease,” he wrote two days later, during a scheduled storm water inspection of the site.

“Evict tenant and start over,” he wrote in the notes.

Caltrans issued a three-day eviction notice a year later, on Aug. 24, 2023, then filed suit against Nowaid, his firm and his subtenants on Sept. 20 for failure to pay rent. Caltrans claims Nowaid owes $78,000 in back rent.

The property was one of five that Caltrans was attempting to evict Apex and another Nowaid company from, including a plot along the 5 Freeway in Sun Valley and another a block away from the fire. In all, Nowaid owed about $620,000 to Caltrans in unpaid rent as of September, the agency said in court filings.

The case is expected to be heard early next year.

Israel Quintero, who rents a spot not far from the fire, arrived at work on Monday to the drone of traffic. The freeway was opened Sunday night. He said Caltrans had sent workers there earlier that day to warn the tenants that they could be forced out. He said he is already looking for places to stay.

“It’s been a terrible experience, full of stress,” said Quintero, who runs a body shop under the freeway. “My family, my children depend on this job.”

The shop itself probably looks like the one that burned. When Times reporters arrived at the cavernous lot underneath the Quintero works on Friday, pallets could be seen piled high. Work stalls were separated by massive wooden walls. There were rows of cars that were mere shells.

Quintero said he isn’t hiding anything. When he rented the stall, he told Nowaid exactly what he would be doing.

“We are not doing this illegally,” Quintero said.

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