City Council Sets June 27 Date for Vote on Coal

  • Mockup of an Ordinance

Above: Artist’s rendition of an ordinance regulating coal.

On May 3 the Oakland City Council took major steps towards adopting an ordinance relating to the threatened use of the Oakland Bulk and Oversize Terminal (OBOT) for storage and export of coal.

The Council unanimously agreed to hold a first vote on a ordinance at a special meeting on Monday, June 27, starting at 5:00.  It will be the only item on the agenda.  Any ordinance must be voted upon at two separate meetings, and holding a first vote in June means the ban on coal sought by No Coal in Oakland could be enacted before the Council’s summer recess.

Under City Council’s rules governing special meetings, the text of the City’s proposed ordinance may not be announced until Friday, June 24, just three days before the special meeting.

In addition to setting the June 27 date for considering legislation on coal, the Council also voted to pay $120,000 to Environmental Science Associates (ESA) to assist City staff in the review of pro- and anti-coal evidence submitted at the September 21, 2015 hearing and afterward.  The City has been threatened with a lawsuit by OBOT’s developers and wants to be assured that the City has “substantial evidence” to withstand a legal challenge to any ordinance that gets adopted.

The process at this point

In February, the Council was set to vote on a contract with ESA that No Coal in Oakland vigorously opposed.  It would have meant a six- to eight-month delay before their report was issued and would have cost city taxpayers between $208,000 and $253,000.  ESA has a record of supporting developers and is locally notorious for a recent Environmental Impact Report that greenlighted a refinery expansion in Benicia.  The Benicia Planning Commission rejected ESA’s EIR and the refinery’s appeal to the City Council will be heard in September.  More information about the struggle in Benicia can be found here and more information about NCIO’s opposition to ESA can be found here.

Largely in response to NCIO concerns, Assistant City Administrator Claudia Cappio negotiated with ESA a reduced contract for $120,000 and a much shorter time frame.  NCIO had raised concerns that it was inappropriate for ESA to determine if there was substantial evidence to support a ban on coal, as this would usurp the role of the City Council.  At the council meeting, Cappio clarified that ESA will be limited to a supportive role, assisting the City and not itself determining whether the evidence is substantial.  Based on discussions with City officials and staff, it appears that ESA will not be writing its own report but will be working closely with City staff to review and analyze the evidence.  In this process they are also collaborating with Zoe Chafe, an environmental scientist hired by Councilmember Dan Kalb.

Another contribution to this review will be the panel of independent public health experts that came forward out of concern about ESA’s expertise.  As a speaker pointed out, ESA does CEQA reviews that look at acceptable thresholds of pollutants, which is not the relevant standard for the coal ordinance.  The panel, working at no cost to the city, will offer its input and expertise during the review process.  NCIO has expressed hope that the City will cooperate fully with the panel and has obtained positive reactions from Mayor Schaaf and several council members.

Mitigation or ban?

A concern at this point is whether the ordinance that is proposed on June 27 will ban coal or will propose mitigations like covered rail cars and enclosed facilities.  Speakers at the council emphasized that we want a complete ban, and this may well be the inclination of the council members.  But whether the city believes its review of the evidence will support a ban remains to be seen.  This is a major reason NCIO remains concerned about the influence of ESA in the process.

Scheduling June 27

Although City officials had been indicating their desire to settle the coal issue before their summer break, NCIO was concerned about time frames in the ESA proposal which were incompatible with scheduling two votes before recess.  NCIO met with council members and the mayor in the days before the May 3 council meeting to point out the discrepancy, suggest solutions, and strongly urge them to set the first vote before the end of June so that the second vote could take place before summer break.  Council member Rebecca Kaplan said at the council meeting that one motivation for getting the ordinance vote sooner rather than later is to enable Oakland officials to speak in support of Senator Loni Hancock’s pending bills restricting coal exports from California.  Because council members have been instructed not to take positions on coal until it comes up for a vote–again out of concern about a future lawsuit–no Oakland officials have testified in Sacramento in support of Hancock’s bills.  Another reason to move forward quickly is that July 1 is the effective date of the Utah law releasing funds for investment in OBOT.

CCIG position

On the ESA contract, there was speaker on behalf of California Capital and Investment Group (CCIG), the firm of developer Phil Tagami.  CCIG’s law firm, Stice and Block, was represented by David Smith.  He said that the review was premature because CCIG has not yet committed to shipping coal and its design plans are too preliminary to be evaluated.  Council President Lynnette Gibson McElhaney challenged him, pointing out that these plans were part of the evidence submitted at the hearing.  He said the designs submitted are only a start.  “We haven’t committed to coal.  We haven’t committed to anything yet.”

A couple of coal activists spoke in response to this claim, saying that it is certainly timely to ban coal before such a commitment is made.  Brittany King from the Sierra Club noted that since the developers don’t have a plan—“Don’t let there be a plan.”  The developers have said there are 15,000 commodities that could be shipped through OBOT—so this will leave them 14,999 options (minus the fossil fuels that might also be banned if there is sufficient evidence after a new hearing to be held on May 9th – more on this hearing is at the end of this post).

Smith’s argument raises interesting questions.  CCIG has in the past maintained that the city cannot limit their market options (as Michael McClure wrote in the San Francisco Chronicle “Today it’s coal; tomorrow it’ll be wood pellets; and next week it will be genetically modified grain.”  [March 14, 2016]).

And CCIG has maintained they are only the developers and that the selection of commodities will be up to the operators of OBOT, Terminal Logistics Solutions (TLS).  The relationship between these two entities is unclear (although TLS is housed in the Rotunda Building where CCIG’s Phil Tagami is located).  There is strong evidence that TLS is owned and controlled by Bowie Resource Partners, the coal company behind the Utah offer, and Bowie has already confirmed that it has an “interest” in TLS.

Smith stated, “We do not have a committed partner for the terminal and we do not have a commitment for specific products to be shipped through the terminal.”  But CCIG has clearly been trying for over a year to close the deal with Bowie and TLS to ship Utah coal through OBOT.  The one thing clearly standing in CCIG’s way is the possibility that Oakland will ban coal exports through the new maritime facility.

Many speakers

At the Open Forum, two speakers directly addressed coal and three speakers on other topics noted their opposition to coal. Coal was agenda item 13, and was not discussed until about 10:00 pm.

During the agenda item, Dr. Heather Kuiper announced the formation of a public health expert panel.  Twelve speakers spoke in favor of a ban on coal, including representatives of No Coal in Oakland, the Sierra Club, SEIU 1021, 350EastBay, Communities for a Better Environment, and the Oakland Unitarian-Universalists.  Reverend Ken Chambers of the Westside Missionary Baptist Church spoke on behalf of many clergy opposing coal.

You can watch the proceedings on the City’s website.  The Open Forum starts at 6:31 and the agenda item starts at 4:23:00.

Long meeting, busy Council

The Council had many other agenda items.  They celebrated representative small businesses from every district, acknowledged Bike to Work Week, heard opposition to the discriminatory housing impact fees (a measure that passed on its second vote) and in support of a city-wide vote on renter relief, and heard many thoughtful speakers in support of placing on the November ballot a tax on distributors of sugar-sweetened beverages (one cent per ounce to be used for education and health care).  After the coal item, there was a discussion of regulating and taxing marijuana.  Quite an evening!

Expanded scope?

On Monday, May 9, the City will hold a public hearing on expanding the scope of the ordinance to also include crude oil, fuel oil and gasoline.  Councilmember Noel Gallo expressed his concern that this would delay a vote on coal, which has been a concern of NCIO’s as well.  He was assured, as we have been, this was will not happen.  If the City deems it possible, all these fossil fuels may be regulated in a single ordinance, but City officials have indicated that, if there isn’t evidentiary support yet for the expanded scope, an ordinance on coal will still be put forward for a vote in June.