California businesses hit by East LA oil spill say promised payments are still missing

A May oil spill in East Los Angeles did more than cover streets and fill storm drains. It also interrupted appointments, deliveries, and daily business for local businesses. Some owners say the biggest headache has been waiting to recover money they say they never should have lost in the first place.

What happened?

According to Boyle Heights Beat, construction crews hit an underground pipeline in May near East Cesar E. Chavez and Eastern avenues, leading to over 25,000 gallons of crude oil spilling throughout the surrounding streets and storm drains. Parts of the nearby commercial corridor were closed for about a week, affecting restaurants, barbershops, contractors, and other small businesses.

Not only are these types of oil spills a major hazard for the environment, but they can directly hurt people's livelihoods. Kelly LoBianco, director of the Los Angeles County Department of Economic Opportunity, told Boyle Heights Beat that nearly 50 nearby businesses reported revenue losses of 70% to 75%.

Many owners later submitted reimbursement claims to pipeline operator Pacific Pipeline System, or PPS. County officials said progress has been slow; Boyle Heights Beat reported that 19 businesses had filed claims, one had been approved, and three more were close to approval.

Barber Avila, owner of Brooklyn Lab Barbershop, said his claim was approved but he was still waiting to receive his payment. Veronica Ramos, co-owner of Ramos Industries, said her business was reimbursed after canceled jobs and delayed deliveries disrupted operations.

Why does it matter?

For businesses with little financial cushion, a closure that lasts only days can cause problems that continue well beyond it. Missed appointments, delayed shipments, and a broken schedule can still affect rent, payroll, and customer relationships after cleanup crews leave.

There may also be more disruption ahead. As Boyle Heights Beat reported, county officials said soil testing and excavation connected to the spill could continue until January 2027, prompting concern that future street closures may again keep customers and delivery vehicles away.

Oil spills can contaminate streets and waterways in an instant, but the damage tied to the industry extends well beyond a single accident. Coal and natural gas power plants contribute to air and water pollution linked to asthma, heart disease, cancer, and premature death, while also locking households into high energy costs instead of increasingly abundant sources such as sunlight and wind. Industry lobbying has also helped stall cleaner, cheaper energy alternatives that could better protect families and reduce monthly bills.

For people already dealing with pollution burdens and economic strain, reimbursement delays can deepen mistrust and make recovery even harder.

What's being done?

PPS said it is continuing to accept and process claims and that affected businesses can get help from a third-party claims administrator in English and Spanish. In a statement, the company said, "We understand how important a timely resolution is for those affected and remain committed to working through each claim as efficiently as possible."

Boyle Heights Beat reported that business owners can also get help assembling claims and documentation through the county's Office of Small Business in the Department of Economic Opportunity. Owners can call (844) 432-4900, visit the East LA Entrepreneurship Center at 4716 E. Cesar E. Chavez Ave., or email osb@opportunity.lacounty.gov. Boyle Heights Beat said businesses should note that their request concerns the East LA oil spill.

Anyone who believes they were affected can also use the PPS claims line at 1-877-817-5465. Boyle Heights Beat reported that there is no deadline to submit a claim.

When you're already dealing with the financial burden of missing payments, getting scammed could make an already difficult situation even worse. County officials are cautioning residents and business owners to watch for scams. According to Boyle Heights Beat, Rafael Carbajal, director of the LA County Department of Consumer and Business Affairs, said the office can help verify contractors and legal service providers. People with concerns can call the DCBA hotline at (800) 593-8222, according to Boyle Heights Beat, or check out DCBA's website on recognizing common scams.

Avila said, "You know how the barbershop gets on a Friday. … We lost a lot of business that week." 

Ramos, thinking about the possibility of more closures, put it more simply: "It's good to keep it in mind."

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