Porter Ranch homebuyers not told of gas field risk until after leak

The boundary of Southern California Gas Company property, where Aliso Canyon Storage Field is located, is seen as people continue to be affected by a massive natural-gas leak in the Porter Ranch neighborhood on Dec. 22, 2015.
The boundary of Southern California Gas Company property, where Aliso Canyon Storage Field is located, is seen as people continue to be affected by a massive natural-gas leak in the Porter Ranch neighborhood on Dec. 22, 2015.
David McNew/AFP/Getty Images

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People buying homes in Porter Ranch signed documents saying they'd been advised of many potential hazards in the community before closing their deals — high winds, wild animals, fire danger, even distant  airport noise. But none of those disclosures warned prospective residents they were moving next door to one of the nation's largest underground natural gas storage fields.

The Aliso Canyon storage field has been in operation in one form or another since the 1930s — long before the first homes in Porter Ranch were built in the late '60s.

But it wasn't until mid December — nearly two months after a massive gas leak erupted at the facility — that mention of the field was added to home purchase contracts.

"When we first circulated the disclosure statement we called it a red alert," said Jim Link, CEO of the Southland Regional Association of Realtors, which writes the four-page disclosure document that is part of most home sales in the San Fernando and Santa Clarita valleys.

The disclosure describes the release of methane from the four-month leak and illnesses that many residents reportedly experienced. It also cautions buyers that real estate sellers do not have the expertise to advise them on how the leak might affect property values.

"As long as the gas fields are up there, we will disclose it," Link said. "The location is there, and where people go to get further information if they want it."

The disclosure came too late for homeowners like Luan Truong. He and his wife bought their Porter Ranch home in June, but they haven't been able to enjoy it much because they've been staying in hotels for months.

"It's been very disruptive to the family,"  Truong said as he as stopped to chat after leaving the Porter Ranch storefront where SoCalGas representatives advise residents about relocation assistance and other leak-related issues.

"The day-to-day routine is just not the same," Truong said. "We're up at the hotel. We have to make arrangements to go back and forth to the house."

The well blowout led Los Angeles County to order SoCal Gas to pay to relocate as many as 8,000 families. The leak was plugged in February, but Truong and his wife are among more than 3,700 households that continue to live in hotels and short-term rentals outside Porter Ranch.

Truong said the couple doesn't want to return until they are sure the air is free from leak-related chemicals. They are trying to start a family and don't want to take any chances, he said, "because we don't know the long term implications, I'd rather be safe." 

Truong said he didn't know about the gas field before they bought their five-bedroom home.

"I don't remember any disclosure, I mean, there's nothing from the gas company," he said.

Thousands of Porter Ranch residents have signed onto more than 140  lawsuits  against SoCal Gas over the uncontrolled gas leak.  Among other things, the residents want to recoup expected hits to their property values.

Some could argue that that they didn't know the gas field was near or that it presented a risk to their health or home values. State law requires home buyers to receive disclosures of potential hazards, but that only applies to hazards the sellers and their agents can be reasonably expected to know about. 

"The realtors, like the seller, are required to make disclosure of material facts of which they are aware," said real estate attorney Jeffrey Kahn.  "The problem here is that the Realtors and the sellers were not aware of the particular issues."
The disclosures that accompany real estate transactions are mostly intended to describe hazards on the property itself, not the surrounding area, said State Bureau of Real Estate spokeswoman Joyia Emard.

It's up to home buyers and renters to do their own due diligence about their future homes, she said. Municipalities can require additional disclosures, but so far neither Los Angeles city nor county have required it for the Aliso Canyon gas field.

Disclosures vary near other gas fields
SoCal Gas operates three other gas storage fields in Southern California. The Honor Rancho field in Santa Clarita is across Interstate 5 from hundreds of single-family homes,  but homebuyers there don't get a disclosure statement about it. It is also near the Pitchess Detention Center, a Los  Angeles County jail housing 6,700 inmates.

In Santa Barbara County, a community of 200 mobile homes sit just across a creek from another gas storage field in Goleta. The Santa Barbara Association of Realtors does not include the gas field among its standard disclosures, said spokesman Bob Hart. 

Roy Bagdassarian bought a vacant lot on the bluff above the SoCal Gas storage field in Playa Del Rey and built his house on it in 1987.

"We were told nothing about the gas company," he said. "I mean, you could see it, you knew it was there, but as far as disclosure, there was none."

Beginning about 1998, real estate agents began disclosing the Playa del Rey gas field in some cases, said Tom Corte of ERA Matilla Realty. He said it depends on how close the home is to the gas field. 

"Buyers are advised to obtain environmental impact reports or check with the state (Division of Oil, Gas and Geothermal Resources) to determine if those or other risk factors are present," Corte said. He also advises buyers to check with the office of City Councilman Mike Bonin.

Some want more advisories

Some say real estate sellers and their agents should have been aware that the Aliso Canyon gas field posed a risk to neighbors based on past incidents.

One occurred in 1968 when a well there ruptured, spewing 100 million cubic feet of gas and needing 17 days to plug.

Tom Williams, an environmental consultant who advises a Porter Ranch community group trying to close the gas field, said even the new disclosure should have much stronger language than it does.

"You should be prepared to evacuate given a two-hour notice, because it could ignite. It is an explosive environment," Williams said.

The history of a potentially hazardous site could shape what's disclosed to prospective residents, but it's more common for lawsuits and court judgments to trigger disclosures to protect sellers and their agents from future legal action, said David Kissinger, director for Government Affairs at the South Bas Association of Realtors.

"The transaction itself is a civil transaction, so a local jurisdiction will only get involved if there is a public safety issue, or violation of a code," Kissinger said.

Porter Ranch master plan predates gas storage field

The 1964 master plan for what would become the 30,000-resident Porter Ranch community came decades after oil and gas operations were launched just up the hill in Aliso Canyon. Back then, it was called the Porter Oil Field.

That master plan didn't mention the field, and homebuilding began in the late 1960s. By 1972 Getty Oil had sold the depleted Porter Oil Field to Southern California Gas Company. The wells that had been initially drilled to remove gas and oil were converted to move gas in and out of a natural rock reservoir 9-thousand feet underground.

In the years to come, there would be a dozen more Porter Ranch environmental and community planning documents. They describe earthquake faults, freeway construction, fire danger, even the smog people were breathing. But none appears to mention any risk from the gas wells of the Aliso Canyon storage facility.

That is, until 2008, when the developer of a proposed community called Hidden Creeks Estates said its future homes would be built next to a gas storage field that it said posed no hazard. That development was on track for approval last year and was to be annexed into Los Angeles, but it has been stalled since the gas leak.

About 77 percent of homes in Porter Ranch are owner-occupied, according to the 2010 U.S. Census.

The value of the owners' investments, and their ability to resell their homes is  at stake as more becomes known about the gas leak and the health problems people have reported.

So far, home prices have been largely unaffected  by the gas leak. Like much of LA, Porter Ranch homes are selling for more this year than last, up about 8 percent. But the number of home sales is down 40 percent, and it takes about 20 additional days to sell a home in Porter Ranch, according to real estate data by Redfin.com.