Diane Reed said a stroke of luck -- a phone call from her husband -- likely saved her daughter from being killed by an earthquake (search) that crumbled buildings in this quiet community Monday as people fled in terror.

Reed and her 15-year-old daughter were working in her gift shop, anticipating a large Christmas shopping crowd, when the ground began to rumble.

"We were just standing there and all of a sudden the ceiling started caving in," Reed said, standing in a park across from where bulldozers and cranes tore down what was left of several brick facades.

Reed's husband runs a printing company just across the street and called for his daughter moments before the quake hit. She walked across the street to see her dad.

"If she hadn't left I would have had her hanging dresses in the front of my store. She would have been gone," Reed said. "He saved her life."

Reed fled the store through a back door before much of the roof in the front of the store caved in.

Dozens of rescue personnel dug by hand and shovel as backhoes lifted piles of red bricks off crushed cars along Park Street, where four businesses, including Reed's, were destroyed.

The smell of sulfur and dust hung in the air. Paso Robles (search) police Sgt. Bob Adams said the city was built above sulfur wells, once used for spas and mudbaths. The wells have since been capped but some appeared to have suffered cracks from the quake, Adams said.

Two women, ages 55 and 19, were killed on a sidewalk outside a dress shop when the brick and wood awning attached to a roof collapsed, crushing them, Adam said.

Rescuers were still searching buildings Monday night.

Olga Agnew's hair salon was packed with customers when the building began to shake.

"I told everyone to run out. This building is not safe," she said, watching from the park as firefighters dug through the rubble. Agnew's salon suffered minor damage.

Marilyn Curry dashed from her law office as she watched the roof crash down on the sidewalk across the street.

"There were people shouting frantically, 'Oh my God, oh my God,"' Curry said. "You could just hear the screams."

Frank Mecham, the mayor of the city of nearly 27,000 people, surrounded by rolling hills and vineyards about 30 miles from the coast, declared a disaster. The Red Cross (search) set up a shelter, but Adams said there were very few victims with injuries and those were only minor.

All the city's downtown businesses were evacuated while firefighters and inspectors determined whether any of them suffered structural damage. Bricks lay on sidewalks amid piles of dust. White gutters dangled from the tops of buildings.

Nick Sherwin, whose jewelry store was in a 19th century clocktower building that was the most badly damaged, stood in the park afterward, watching police, firefighters and news media.

He, too, narrowly escaped before the ceiling collapsed inside his store.

Sherwin appeared shaken as he held the rusty black hands from the old clock, the only memento he was able to save before emergency crews cleared the area.

"Hopefully," he said, "someday we can get that clock working again."