Small Businesses Tally Big Losses After PG&E Safety Shutdown in October

As Humboldt’s collective power switch was flicked off during PG&E’s Public Safety Power Shutoff, small businesses braced for impact, and hourly wage earners cringed at the thought of a diminished paycheck. Lights were out almost everywhere, taking nearly all internet access and most digital media with it. Radio was listened to again, candles were lit, and generators were humming. Humboldt County’s big city lights were all at once snuffed out, while survivalists and preppers in the local hills were finally saying ‘I told you so.’

The aftermath of the minor local emergency was difficult to summarize considering the scope, but the costs were real. Local business managers had a hard time planning work schedules, or facilitating business at all without knowing how long they would have electricity, or even knowing if or when the Public Safety Power Shutdown (PSPS) implemented by Pacific Gas and Electric Company would take place. The updates of estimated shutoff times were more frequent during the second PG&E PSPS event. County residents were largely confused and frustrated, but determined to find the path of least resistance to the gas pump or the hardware store in search of last-minute survival goods.

The full impact on local businesses might be difficult to quantify, considering the scale of the impact, but some takeaways are clear- people do not like getting smaller paychecks than usual, and fresh food doesn’t keep long without an abundance of ice. A few local business owners and managers shed light on what challenges they faced in the dark, during the ‘Great Humboldt Blackout’. What were the biggest complications they dealt with, and some challenges they may face in the future because of PG&E’s recently adopted method of minimizing risk?

Three well-known northern Humboldt County businesses with different challenges explain how they coped and what they are doing to prepare for the possibility of another PSPS. Ramone’s Bakery & Cafe owners Berit Meyer and Brian Ferguson, Chef Alex at Le Monde, and Bonnie Price at Fin-N-Feather, in Eureka each report financial losses, especially revenue, and two of the three acknowledged concerns for staff.

Many Humboldt County businesses took a huge loss of revenue, not to mention losses in inventory. Some were luckier than others. During first outage on October 9th, there was a lot of panic and lessons learned, explained Berit Meyer, one of the owners of the local coffee shop chain, Ramone’s Bakery & Cafe. Between their six locations, they estimate a financial loss after both incidents, of at least forty thousand dollars total in inventory and revenue.

Meyer talked about how the response to the first outage went, looking back with a sense of positivity but still expressing a fair amount of shock as she told the story of their experience.

“On the first one, I mean, we were out of town, and our staff was communicating with us via text…trying to do what we thought should be done, or how would we like to have things go, and since we weren’t in the throws of it, it was a little hard to make the call,” she explained.

Ramone’s Bakery & Cafe’s total loss for both PSPS events in October, as a preliminary estimate, is at least $30,000 loss in revenue, and $10,000 loss in perishable foods, equaling a minimum total loss of $40,000, according to owner Brian Ferguson. That’s a lot of cheesecake.

Meyer explained that during the first PG&E PSPS event, the site managers were having to work together and coordinate to save as much perishable inventory as possible, working on such short notice without a backup power supply, save for one location.

“They did throw out a lot of stuff. There’s a huge inventory list, I have not even gone over it because I’ll be so sad when I see what went,” she said.

Following the lead of Los Bagels, the owners of Ramone’s decided to offer their goods at half off, hoping to be able to clear the pre-made foods and avoid as much food loss as possible. That worked out very well for the first round of PSPS outage October 9th and 10th.

Meyer noted that considering the circumstances, the Ramone’s management and staff did an impressive job of mitigating the damages and keeping the local chain of cafe’s in order.

“We said [to staff], ‘Okay, you guys do what you can,'” she explained. “If we were there, we might have made a different call, but we were really pleased with the [way they handled the] stress…I was very gratified to know that they were doing the best they could in our absence.”

Regarding the ever-changing updates from PG&E, at times contradicted by local updates presented from the Humboldt County Office of Emergency Services and the Sheriff’s Department, Meyer was understanding but also at a loss for an explanation.

“Yeah, that was just the most bizarre, not knowing really what was happening,” she said. “Right away when the first power went off, we were told it was going to go off at midnight. So, our general manager, Hannah, called in the baking staff that night, and said, ‘Please get in early and get everything done by midnight, because if we can be open the next day, we want to have some food to sell.’”

Meyer explained that her staff were working in the dark and in difficult conditions but still managed to hold the business together. “They said people came in with cash, because we didn’t have any power to run the credit cards, and with ‘half off’ they were able to get rid of almost everything in the cold case,” she told us.

Ramone’s, like the majority of Humboldt’s local small businesses, had to minimize employee hours and change staff schedules in order to manage the minor crisis. According to both restaurant owners interviewed for this story, from Ramone’s as well as Le Monde, some workers were able to maintain some hours, while others were simply told they could not work during the outage.

“Right away people were worried about their wages, not being able to work, and…we thought, ‘oh dear, this is just going to only get worse’ when you think about how many people will be without work,” Meyer said.

The plan was to bake as much as they thought they could sell, and be ready to play it by ear. Without much information to go on, they planned accordingly, hoping for a reason to go to work as usual. Like many other stores, they were not seeing the usual flow of customers, not even close.

“And then, on the second one, we were so much more prepared, and also we were anticipating being really busy again, but other people were more prepared, so we weren’t the only people open, so we anticipated being busy but then we weren’t,” Meyer said. “The neighborhood definitely was happy that they had a place to go. Brian did pour-over coffee all day, with a headlamp on in the kitchen.”

Ramone’s had to invest a substantial amount of money in supplies to get through the power outage. “We got a load of dry ice…We just went to all of our stores, rounded up all of the dairy, all of the perishables, the cheesecakes, the decorated cakes and things that needed to be refrigerated, brought them all back!” Meyer explained.

Meyer’s said she tried to look at the situation philosophically, “I mean, I think the reality check is…super inconvenient, and we did lose a lot, but we weren’t in the fire line…[B]ut, thankfully we’re big enough that we can absorb hiccups like this… and we can only do so many of these, but people that are very very small and rely much more heavily on their income for a day or two- that would be very very stressful.”

As far as recouping the losses from October, she was hopeful that there could be some compensation from their insurance policy. However, yesterday she learned that the insurance company won’t be reimbursing them for any of their losses. Because, she wrote us, “there is a clause about it being connected to a “government shutdown” and thus it’s not covered.”

Meanwhile, at many local businesses, including Ramone’s, there is new PSPS policy and protocol being decided on for possible future PG&E power shutdowns.

Across Eureka, in another normally bustling business area, Fin-N-Feather lost power with the rest of Humboldt County. The locally owned pet shop took the power shutdown in stride, happily reporting zero casualties. None of the fish and birds, reptiles, kittens, and various large insects died due to the power shutdown. The small family-owned pet shop did have a back-up generator, but it was not big enough to supply the whole business. The loss in revenue was not tallied at the time of this interview, but the shortage in shoppers was obvious. Very few customers came into the store during shutdown even though business was open.

One dent in the inventory was a total loss of refrigerated dog and cat food. They had a generator, but according to Bonnie Price, a manager at Fin-N-Feather, in all of Humboldt County they couldn’t buy a long enough extension cord to reach the refrigerator, and so they unfortunately lost all the gourmet dog and cat food, at an estimated loss of $800.

“All the animals are great,” Price said. “We have the back-up generator for all the fishes, and the reptiles that we’re moving power from one to another, to refrigerators and freezers. So all the fish are at least getting warmth and air, and the reptiles are getting some warmth, and the birds are fine- they have feathers.”

Bonnie assured us that Dolly, Fin-N-Feather’s resident Scarlet Macaw, was ‘just fine’, although temperatures on the Sunday morning of the PSPS were recorded as low as 36 degrees in Eureka.

The biggest loss was the missing revenue during the outage. According to Price, the shop tried to stay open as much as possible, taking cash and checks from local customers needing family pet supplies in a hurry. They plan to keep regular opening hours should a PSPS event happen again, but will close early depending on what happens that day.

Staffing concerns at Fin-N-Feather were said to be less of an issue than the lack of business. It was the second time in two weeks a planned power outage had disrupted the regular flow of shoppers and business as usual in Humboldt County.

Just across the street from Fin-N-Feather, at the restaurant Le Monde, even when the electricity came back on, the restaurant couldn’t open right away following the second round of PG&E power shutdowns. It was too much of a setback.

Owner and head Chef, Alex, immigrated from France about 30 years ago, and has been in Humboldt for about 18 years. Alex estimates that Le Monde lost between $15,000 and $20,000 total between the perishable foods that were wasted, and the lost inventory.

But, he was clear on what aspect of the loss was hurting his business the most. He said beyond the inventory and the revenue lost, the most difficult thing was downsizing employee hours.

“That’s one of the big damages,” he explained. “I’m in a different income bracket than a lot of the people that I employed, that are like on minimum wage, you know, so I have way more flexing muscle than they do…[T]hat’s who is really going to get screwed out of this. Employees that are, like on minimum wage, that are pulling like six hundred bucks every two weeks. What are they going to do? And that’s really what sucks…, to tell you the truth.”

He noted that many people will not be able to make their rent payments, as well as other regular utility payments on time.

“It’s double whammy,” he said. “Basically, to put it into actual numbers, it slashed revenue for October in half… [O]n Saturday we pulled $480…[N]ormally Saturdays are like $2,500., and you can actually multiply that times whatever, how many restaurant days in Humboldt, actually.”

Logistics proved to be a huge challenge. Alex spoke about planning for employee safety as restaurant staff attempted to do what was possible in the dark, to salvage perishables, conduct business, and prepare food, and keep up health and safety standards all the while. He noted that having been through a couple major earthquakes in the northwest, he said this power outage felt very similar to a natural disaster. He applauded the way Humboldt County residents handled the emergency, staying positive. Alex acknowledged that there was a lot of negativity about the shut-offs, but that he is keeping it in perspective.

“I must say I’m super impressed with the community here, like how together they’ve kept,” he said. “When I went to Winco, on the day they were shutting the power off, people were super orderly.”

After missing out on a weekend of revenue during the October 26th PSPS event, on the heels of the previous PG&E power shutdown, Le Monde was nearly crippled. The strain on business was evident. The restaurant was only able to open several days later, for dinner on Halloween following the return of power, and then was only able to keep a minimal staff of one dishwasher and one server. Alex says that as a family-owner business, he is very aware of the responsibility he has to the small crew of staff he employs. They were not able to open right away, nor were they able to produce the lunch menu in addition to the regular dinner menu, after the PSPS event diminished his ability to fully staff the restaurant.

“So, basically I’m not going to re-open for lunch, I don’t think I can re-boot that…” stated Alex, when asked about regular business hours resuming. Additionally, Le Monde posted to social media that dinner was on the menu again, but still no lunch. He went on to explain that he’s had to trim down his staff to skeletal support.

“So at this point I’m just running it on life support,” he said.  He explained that he was trying to keep on “my most vulnerable employees…My one server, that’s her main job and she has a child, and so I want to make sure that she has a paycheck—at least something.”

Le Monde has considered buying a generator for these planned emergency PSPS events, adding another cost to the restaurant’s operations. Buying a large generator and installing it according to safety regulations may be cost-prohibitive for many small businesses. Alex is also hoping that Congressman Jared Huffman, and Senator Mike McGuire are going to help secure a rebate or some kind of compensation for small businesses from Pacific Gas & Electric.

The County of Humboldt is trying to gather information about how the shutoffs impacted local residents. They have a website for registering your feedback regarding the October 26th-28th PG&E Public Safety Power Shutdown. The same form is available regarding the previous PSPS event of October 10th, 2019.