The state was long aware of conditions under Interstate 10 where a massive fire Saturday severely damaged the freeway south of downtown Los Angeles — with Caltrans inspectors on site as recently as Oct. 6, according to state officials, tenants and a lawyer for the company leasing the land.
The plot of land was leased by Caltrans to a private company that subleased it to small blue-collar businesses at much higher rents.
For years, a pallet distributor, a recycler, a mechanic shop and a garment factory supplier operated between the freeway pillars on East 14th Street a block east of South Alameda Street. Along the perimeters, homeless people camped and lighted fires to keep warm.
The conditions did not raise any apparent alarm bells among state officials who regularly inspected the site. Google Earth photos from January 2023 and March 2022 show dozens of columns of pallets stacked two stories high, amid piles of tires, wood boxes, cardboard and old vehicles, all visible from four streets and a freeway offramp.
"Caltrans staff inspect all airspace lease sites at least annually to check for potential safety hazards and lease violations," said Eric Menjivar, a spokesperson for Caltrans District 7, which maintains state highways in Los Angeles and Ventura counties. Areas under and next to the freeway are considered airspace.
"Staff also monitor what is placed or stored on site by the tenant. If deficiencies are noted, Caltrans staff notifies the tenant for remedy. The State Fire Marshal also inspects regularly for fire and life safety."
Menjivar said Caltrans inspected the property Oct. 6 after Caltrans had filed a lawsuit to remove its tenant, Apex Development Inc., for noncompliance with the lease. The suit, filed in September, said the company had not paid its rent in more than a year and had illegally sublet the land to a host of small businesses.
The California Department of Transportation has not provided inspection reports requested by the Times.
Jose Luis Villamil Rodriguez, who started renting a spot on the property from Apex in 2011, said he watched Caltrans inspectors regularly come to the site.
"They would even take photos," he said. "Everyone knew what was under the freeway, they saw the pallet yard and so I'm pretty sure they were aware of it."
Rodriguez said the pallet yard business had been under the freeway for about seven years. He said the owner was constantly storing and moving the pallets. Rodriguez said he never interacted with the inspectors. Out of caution, Rodriguez said he had fire extinguishers at his job site. "Whether others didn't, I wouldn't know," he added.
Caltrans had rented the 48,000-square-foot lot to Apex and its owner, Ahmad Anthony Nowaid, starting in 2008. Under Apex's lease agreement, the property could be used only for parking operable vehicles and “open storage”; other uses required the approval of Caltrans and the Federal Highway Administration, something the company does not appear to have secured. Apex was also not allowed the storage of inoperable vehicles, flammable materials or other hazards.
The lease agreement between Caltrans and Apex was filed in court as part of the state's lawsuit against the company for unpaid rent. As of September, Apex owed nearly $80,000 in back rent on the property that burned.
A court hearing in the suit is scheduled for early 2024.
Apex, through its attorney Mainak D'Attaray, confirmed that Caltrans had inspected the lot at East 14th Street at least once a year. The lawyer also disputed that the various small businesses renting from Apex were there illegally; Caltrans "was fully aware of the sublessees and their operations," he said in a statement.
The attorney argued that state officials were wrongly blaming the company and knew about homeless encampments and the overall conditions at the site.
“Even the State of California’s Fire Marshall inspected the premises,” D’Attaray said in a statement. “Apex is sympathetic to the loss of property and the adverse impact the fire has caused the people of Los Angeles. But Apex was not involved in the fire. Apex is being unfairly scape-goated for something over which it had no control.”
The lot at the edge of the Fashion District is one of five that Caltrans had rented to Apex’s owner, Nowaid. Caltrans had filed eviction proceedings for all five properties, saying Nowaid’s firm owed a total of at least $620,000 in unpaid rent.
Earlier this week, Gov. Gavin Newsom criticized Apex and its owner without specifically identifying Nowaid.
“This guy and this organization, whoever the members of that particular organization are, have been bad actors,” Newsom said at a news conference. “They stopped paying their rent, they’re out of compliance, and as was stated yesterday … they have been subleasing this site to at least five, maybe as many as six tenants, without authorization from Caltrans or authorization from our federal partners.”
D'Attaray said that the eviction suits were retaliation by Caltrans for a lawsuit that Apex had filed in June, accusing the agency of interfering with his business.
He said the governor and Mayor Karen Bass were trying "to excuse their own failures to adequately address the public safety issues caused by the unhoused.”
Apex had repeatedly called the Los Angeles Fire Department to report fires started by homeless people who pitched tents around the perimeter of the lot, D'Attaray said. He claimed that the city’s fire and police departments responded “dismissively.”
“The unhoused persons camping along the fence line of the premises were allowed to remain and accumulate all types of refuse and materials over which Apex had no control,” D’Attaray said in the statement.
A spokesperson for Newsom rejected the idea that the governor’s statements were off base.
“CalFire currently believes the fire was caused by arson — the criminal act of deliberately setting fire to property — in a fenced-off area that Apex was responsible for maintaining while they continued to assert rights under the lease,” the spokesperson said.
A representative for Bass did not respond to requests for comment.
A Caltrans engineer, who asked to withhold his name because he was not authorized to speak, said that it was the state agency that should have seen this coming.
“Caltrans has known about this for a long time,” the engineer told the Times earlier this week. “They have permitted lessees to store flammable stuff underneath these freeways for decades. They’ve had a couple of fires in the last three years that have affected columns, but inspectors can’t completely get underneath the bridge to make a thorough inspection because of all the junk.”
In Atlanta, a similar fire in 2017 caused a portion of the 85 Freeway to collapse after a 39-year-old homeless man who police said had been smoking crack set fire to an upholstered chair on top of a shopping cart.
The fire ignited combustible materials stored under the freeway. Federal investigators found the Georgia Department of Transportation partly responsible.
In an alert sent out to transportation agencies across the country, the National Transportation Safety Board warned: "Although catastrophic fires fueled by materials stored underneath bridges are relatively rare events, the loss of this structure demonstrates what can happen if bridge owners are not vigilant about monitoring and controlling such materials."
The I-85 closure snarled commuter traffic on the region's busiest throroughfares for six weeks. In response, Caltrans wrote up a policy directive directly based on that incident that prohibited the storage of flammable materials under its bridges and required access for bridge inspections.
It is not clear if it was enforced.
Assemblymember Miguel Santiago (D-Los Angeles) said the fire on Saturday "should have never happened.
"There’s already protocols in place,” he said. He praised the governor's response to the fire and his administration, which has pushed the effort to "Fix the 10."
Santiago said he felt confident that the governor’s office and Caltrans would provide information about the state’s leases, including a review of litigation and enforcement mechanisms.
“Once we get the information there needs to be strong accountability mechanisms in place to prevent anything like this from ever happening again and putting the public at risk.”
Carina Quinto, who runs a mobile mechanic shop out of the freeway underpass, was bewildered by officials. She had been watching news reports about the fire and was surprised to hear officials say they had no idea what was going on under the underpass.
"Supposedly the city didn't know the kind of businesses that were running under the freeway. They knew exactly what we were doing," she said. Someone from sanitation came regularly to check that oil was properly disposed, she said.
When asked for proof of the visit, she said, it burned up in the fire.
Times staff writers Taryn Luna and Thomas Curwen contributed to this report.
This story originally appeared in Los Angeles Times.