Unlike treasure buried in the ground could be a huge liability, something that's absolutely crushing, something that can bankrupt you, something that can absolutely ruin your life, and yet so many self storage facility owners don't think or know about what I'm talking about. This is Frank Rolfe, The Self Storage University Podcast. We're talking about buried dangers in the earth and how to mitigate that risk. Now, I'm not talking about things like environmental contamination. We all know about that. We all know that you always want a phase one environmental survey done in any property that you buy to make sure there's not a landfill or buried petrochemicals. But what I'm talking about instead are the utility lines that criss-cross much of America, that are not part of what we normally think about being in the ground. These include fiber optic cables, jet fuel transmission lines, even the cable that connects the army bases together, that was called the strategic command cable.
Now, why are these things on our properties in America? Well, because we have to run these things often from coast to coast, and as a result, you can often get these giant utilities, and they're buried fairly deep into the ground to try and hide and prevent someone from hitting them, but they're there nevertheless. But not all of them are even really that deep. Fiber optic cables, sadly, are not that deep. You probably have seen those being laid along the highway. I'm sure you're driving around and you see along a two-lane country road or highway, perhaps, someone putting in cable. And you can see, from the way they're digging it, it's not that far in the ground. Maybe just a few feet. Those fiber optic cables that they lay, if you cut one of those, here's what happens, you not only have to pay to put it back together, but you have to pay them for all the lost amount of service, and that's typically a seven-digit or more bill. They were putting in a traffic light in Denton, Texas years ago, and they didn't really pay attention, and they didn't know what they were doing, and they drilled the hole to put in the traffic light, and they hit the fiber optic cable. And that fiber optic cable bill came in at about $12 million. That's what it cost them to hit that cable, loss of service, and to get it repaired. That is a crushing amount of money.
Now, the city of Denton was able to pay it because they were a giant city. But could the typical self-storage operator pay that kind of a sum? No, absolutely not. Well, so then how do you protect yourself over the fact that there are things lurking in the ground? Well, the key item you have to think of is the fact that in almost every state, there is a service. Some call it Dig Test. Some call it One Call. And what that service does is it shows you where the lines are located before you dig. For example, let's say you wanted to put up a fence right in front of your self storage facility, a new, nice-looking fence, or maybe a new sign. All you do is you call up One Call or Dig Test or whatever it's called in your state, which you can easily find on Google, and you tell them where are you gonna be digging. Typically, they'll ask you to put in a stake or spray paint on the ground, what it is, and then each utility will be notified, and they'll typically come out and they'll spray-paint "Okay" in different colored spray paint with whatever that utility is. They might come in and put "AT&T. Okay." Next, they might put "Gas. Okay." And they're doing that so that you know that you're clear.
Now, if they mis-mark it or they don't get out there, then if you hit the utility, it doesn't fall back on you, it falls back on them. But make sure you understand the rules of engagement so you don't run a foul of it because the penalties, again, are extreme. Now, why would you be digging on your property? Well, if you think about it, you might be digging to put in a fence or a sign, or maybe you're gonna put in some safety bollards. Who knows what you're doing? Maybe it's just the initial construction. Maybe you're trying to add another wing on. The problem is, at any time a shovel or a drill hits that earth, you don't know exactly what you will hit.
Don't forget that erosion is a very powerful force in some parts of America. Some of these old lines that were buried years and decades ago, the ground is eroded away, it's washed away, and the thing that you thought might be 4 or 5 feet deep is only 2 feet deep, well within the range for someone to hit with just a post hole digger. And the big problem you will have is if this were to occur to you, you would really kick yourself since there was a way to test to make sure you did not have that problem. Don't for a minute think, "Oh, well, I'm too lazy to do that. I'm sure my insurance will cover it." No, your insurance does not always cover it. In the case of the fiber optic cable, it maybe more than your insurance even is. In other cases, it may not fall within the realm of your policy. If you truly read it under the liability section, hitting the utility line may not be covered. And that doesn't include all the additional lawsuits that could come from hitting a utility and knocking out whatever that utility is. If you knocked out water, for example, it's possible that restaurants and people who couldn't serve that day, they might come in and sue you for their loss of revenue. They might even sue you for some kind of punitive damage.
The bottom line to it all is you have to be aware that there are things in the ground. You can't see them. No, you can't. They're completely buried. But you have to make sure that you acknowledge that there are things in the ground and that you definitely, before you ever dig, locate the number to call, whether it be a dig locate service of some type, like One Call or Dig test, and make sure that you are clear to dig. If you don't do that and you hit something, it could truly end your career. There'd be horrible shame to have something that you never even thought of, something that was not a part of your decision of due diligence, of understanding the self storage industry or making the right selection of property to buy, something as small as just a buried cable or pipe in the ground. So, you've got to always proactively protect yourself.
This is Frank Rolfe with The Self Storage University Podcast. Hope you enjoyed this. Talk to you again soon.