Palo Alto Utilities changes tests for gas workers

Dogged by a federal investigation and accusations of fraud in its gas division, Palo Alto’s Utilities Department has quietly revised the testing procedures for its gas-line operators to make sure they are fully qualified for the work.

The department has been in the spotlight since Feb. 6, when a group of federal agents from the U.S. Department of Transportation (DOT) made a surprise visit to the Municipal Service Center on East Bayshore Road and seized seven boxes of operator-qualification tests.

The City Council discussed the investigation in a closed session this week and City Attorney Gary Baum said Palo Alto could face a civil suit from the federal agency, which has been investigating fraud allegations for more than a year.

The February raid was prompted by accusations from former line installer and repair worker Michael Estrada, who was fired in August 2008 after being convicted of driving under the influence. Estrada alleged that in 2006, he was asked by his former supervisor to fill out “operator qualification” test forms for about 60 employees.

Estrada also claimed the direction to falsify the tests came from two managers, Javad Ghaffari, superintendent of the city’s Water-Gas-Wastewater Division, and Paul Dornell, the division’s former director and the man who fired Estrada.

City and federal officials would not comment on the ongoing DOT investigation. But over the summer, the Utilities Department hired a third party to review its operations-qualifications procedures and to retest about 30 workers in the gas division.

The company, Chico-based Gas Transmission Systems Inc., reviewed the city’s testing procedures and helped administer the new tests. Robert Gross, a company vice president who was involved in the review, said every Palo Alto employee who was retested by his company passed.

Gross said the department already had qualification procedures in place that exceeded state and federal mandates. The Department of Transportation, which regulates natural-gas lines, requires utilities to use one of many methods — including written tests, oral tests and observation of performance — to ensure its workers are qualified.

Even before the February scandal, the department utilized all of these methods, Gross said.

“They actually go above and beyond what’s required,” Gross said Thursday.

Gross said his company helped the Utilities Department make minor revisions in its Operator Qualification plan, mostly to eliminate sections that did not pertain to the department and revise some of the questions on the tests. The company also administered a variety of tests to the 30 gas-line workers who are required to qualify through testing.

All 30 passed, he said.

“I think the folks in the department know what to do and know how to operate,” Gross said. “It’s evidenced in the fact that they all passed the tests, which weren’t easy.”

Utilities Director Valerie Fong said division supervisors also received additional training. She said she was pleased with the third-party review of the department’s qualification program.

Earlier this year, the department also revised its test forms to make the tests more difficult to falsify. The new forms include sections at the bottom for names and signatures of both the employee taking the test and the person administering it. The previous form asked only for the names of both parties.

Fong said the combination of internal and external reviews has enhanced the gas division’s qualification program.

“Our employees have proven that each of them is trained, knowledgeable and competent to safely perform important natural gas line work on behalf of the community,” Fong wrote in an e-mail.

“The public can be assured that all employees performing gas line work are trained and competent to safely work on the system and that the safety of our community is of utmost importance to us.”

But even if the federal scrutiny helped strengthen Palo Alto’s gas operation, it did little to raise the flagging morale of workers within the department.

Estrada’s allegations against Dornell and Ghaffari came at a time of dramatic change and turmoil within the department. The two managers were reassigned to Utilities in 2005 to bring more “management oversight” and to make changes to the department’s “operations and practices and work culture,” City Manager James Keene wrote in a March 26 memo to the City Council.

These changes included contracting out and streamlining some of the department’s operations, which did not sit well with some workers who saw some of their duties reassigned or outsourced.

The federal affidavit cites two utilities workers, in addition to Estrada, who repeated Estrada’s allegations (both said they learned about the falsifications from Estrada) and complained about the low morale and bad oversight in the division. Dan Serna, a relative of Estrada, said he felt Dornell and Ghaffari lacked the qualifications to manage the division.

Dentell Reed, a utility locator, also complained the supervisors “lacked experience, were not concerned with safety and simply did not know what to do.”

But most department employees saw Estrada’s complaints as false accusations by a disgruntled ex-worker against his former bosses. The week after the raid, the workers in the General Shop of the Water-Gas-Wastewater Division met to discuss the complaints against the department.

According to an e-mail from Supervisor Eric Mueller to Fong, the “consensus” was that “the investigation is a personal vendetta more than a scandal.” Other workers expressed similar sentiments during interviews with the Weekly in the spring.

Fong also sent several notifications to the entire department staff between the time of the raid and mid-summer asking workers to refrain from retaliating against their colleagues in the department.

“I know that the investigation is stressful and challenging for our team, but please be professional and treat all of your co-workers with the same level of respect,” Fong wrote in a June 23 memorandum.

“Avoid petty comments and actions that could appear retaliatory, and if you find yourself in an interaction where you feel like you are struggling to maintain the appropriate level of civility, step away and contact your supervisor for assistance.”

Keene had also personally interviewed the two former managers and wrote in his report to the council that both had “firmly denied any direction of, or participation in, or knowledge of the falsification of the tests.” Keene said he believes them.

Dornell, who now works in the Public Works Department, made it clear that he was deeply offended by the accusations “as his reputation and character have been called into question,” Keene wrote in his report.

Keene also said staff reviewed and closely scrutinized the tests from 2006. In most cases, there were indications that different people took them, he said. But he didn’t rule out the possibility that some of the tests could have been falsified.

“In some cases … there are some tests that do not even have the employee’s name on the top of the test.

“In some of these cases, there appears to be a possible pattern of similarity as to how the multiple-choice questions were marked off. Thus, it may be possible that some of the tests might have been tampered with, or falsified, or filled out by the same person.”

Keene told the Weekly this week that he is glad to see the department’s swift response to the problems identified through the various reviews, including its actions to make the tests harder to falsify. He said the department will “immediately respond” to any recommendations that will come from the DOT as the federal investigation unfolds.

The Utilities Department is also taking a fresh look at its entire organization to see what staff or procedural changes it could make to improve its operations, Keene said.

“They’re not just responding in the wake of the DOT investigation — as they should — but, in many cases, they’re doing even more than they have to,” Keene said. “They’ve made a very serious effort to respond in as comprehensive a way as possible.”