Atlanta water main breaks cost local restaurants big money. Now what?

Restaurant owners seek help from insurance and the city for lost business during days of disruption
Workers that have been working on the city’s water main breaks are seen in front of Steamhouse Lounge in Atlanta on Thursday, June 6, 2024. The restaurant just re-opened after being closed for five days following several water main breaks. (Arvin Temkar / AJC)



Workers that have been working on the city’s water main breaks are seen in front of Steamhouse Lounge in Atlanta on Thursday, June 6, 2024. The restaurant just re-opened after being closed for five days following several water main breaks. (Arvin Temkar / AJC)

Popular Edgewood restaurant BoccaLupo is normally closed Tuesdays, but this week owner and chef Bruce Logue decided to forego the day off and open for dinner service. It was the most immediate way he could think of to make back some of the money he lost by being forced to close May 31 and June 1 because of Atlanta’s crippling water main breaks.

Logue, who estimates he lost about $24,000 from the unexpected closures, is one of many Atlanta restaurant owners who are picking up the pieces following a tumultuous few days that left some restaurants with low water pressure and some with no water at all. A big part of that means navigating options for filing insurance claims, as well as waiting to find out what kind of assistance the city might provide.

“We’re looking back in the rearview mirror, and there’s a crater,” said Logue, who took a “mental hiatus” over the weekend before tackling the aftermath of the water main breaks, including likely filing a claim with his insurance company.

“It’s a no-win situation. We’ve been around for 11 years, and we’ll be OK, but if this happened in my first year, that would be a hard one to swallow,” Logue said.

Workers continued to put the finishing touches on the filled in water main hole Wednesday morning, June 5, 2024 following the city’s announcement that water had been restored following the break on West Peachtree Street and 11th Street. The city said the system was being brought back online slowly to “allow system pressures to build.” (John Spink/AJC)

Credit: John Spink

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Credit: John Spink

On Monday, Atlanta City Councilmember Matt Westmoreland introduced an ordinance for a $5 million recovery fund for adversely affected small businesses.

The legislation, which was backed by all council members and Atlanta Mayor Andre Dickens, notes that the lack of water forced “numerous businesses to close during peak business periods, particularly over a weekend.” That resulted in financial losses for the businesses, “many of which are small, locally owned establishments that are vital to the community’s economic health,” the legislation says.

The fund will be run by Invest Atlanta, the city’s economic development agency, and “provide financial assistance to affected businesses to cover lost revenue, employee wages, and other related expenses incurred during the closures,” the legislation said.

Details are expected to be hashed out in council committees starting next week, including the types of businesses that would qualify.

Sharon Marshall, a server at West End Soul Food Kitchen prepares a plate for a customer on Tuesday, June 4, 2024. The restaurant is one of the many businesses in West End that was negatively impacted by the city’s water main break. (Natrice Miller/AJC)(Natrice Miller/ AJC)

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MoreLyfe Juice Co.’s smoothie business on Cascade Road was disrupted by the water crisis during the high season for its business, said MoreLyfe co-founder and operator Trinket Lewis. “For me, every day matters,” Lewis said to media outside the City Council meeting as it was starting.

She estimates she has lost thousands of dollars in business, after already seeing sales decline because of traffic disruptions due to construction before the water main break. The city closed a stretch of Cascade Road, where MoreLyfe is located, starting in late March to install a new drainage system.

Due to the water outage, “I’ve had to call everyone off,” Lewis said Monday. “I’ve had to go out door to door looking for ice.”

At a news conference on Wednesday, Dickens addressed the businesses that were impacted by the water issues, but didn’t provide specifics on how funds would be dispersed.

Atlanta Mayor Andre Dickens addresses press members on Wednesday, June 5, 2024, to inform the public and the media that Atlanta’s water service had been fully restored. The announcement came after the city endured five days of disruptions due to multiple water main breaks.
(Miguel Martinez / AJC)

Credit: Miguel Martinez

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Credit: Miguel Martinez

“We know that some businesses were directly near a break where water might have come into their business or it might have impacted some operations directly. Those businesses are being visited right now,” said Dickens, who mentioned Eleventh Street Pub and Steamhouse Lounge next to the water main break at 11th and West Peachtree streets. Steamhouse Lounge reopened Thursday, while Eleventh Street Pub remains closed.

Andy Siegel, president of Siegel Insurance in Atlanta and national director of the Independent Insurance Agents of Georgia, said business interruption insurance generally covers physical damage to the property.

Those who pay extra for utility interruption coverage could be covered for loss of water service, but there may be a deductible or a 24-hour waiting period for the coverage to kick in, he said.

Utility interruption coverage is “not always available for every company or for every type of business,” Siegel said. Some businesses like restaurants and manufacturers that need water to operate may get utility interruption coverage.

”Every policy is different,” Siegel said. “There are different options you can buy.”

He said businesses should check with their insurance agents and review their policy “to see if there are any coverages in there that may apply. … There may be coverage in some of these policies they’re not aware of.”

While many in Atlanta went without water for a period, a smaller number of businesses next to water main breaks may have had flooding. Siegel said that might not be covered by insurance because it was groundwater.

Given that the problems were caused by a failure of city infrastructure, Siegel said he thinks the city “has liability and should make them whole.”

Manager Mitch Frohman (left) works at Steamhouse Lounge in Atlanta on Thursday, June 6, 2024. The restaurant just re-opened after being closed for five days following several water main breaks in the city. (Arvin Temkar / AJC)


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Stephanie Fischer, president of the Georgia Restaurant Association, said the organization has been hearing from its members since the financial relief program was announced.

“Everyone is very interested in how they apply,” she said. “We have reached out to the mayor’s office and City Council to see how we can help and be a resource. Our goal is to ensure all the restaurants affected know how to apply once the process is open. If insurance is not an avenue for restaurants, most restaurants will focus on their business and their employees to get business up and going again.”

Leslie Cohen, the owner of Firepit Pizza and Birdcage in Grant Park, estimates she lost at least $45,000 after being forced to close both restaurants Friday and Saturday. On Thursday, she was sifting through insurance paperwork to figure out if filing a claim would be worth her time by the time she paid her deductible.

“It’s an avenue I think is worth diving into,” she said. “I’m assuming I’d qualify, since I’m still a mom-and- pop operation. It might not fully make up for what I lost, but it seems to be an option that’s on my side.”

She said it was a “relief” that the city was working to compensate restaurants for their losses. She likened the situation to what restaurants experienced in 2020 during the COVID-19 pandemic when “everything felt out of our hands.”

“It’s a struggle,” she said. “How long is it going to take? Is this going to be a one-week process, or are we going to be waiting for six months? Unfortunately, the bills don’t stop.”

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