News Barry Wallerstein

Published on March 17th, 2016 | by Paul Rosenberg

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Polluters’ Coup Takes Over Air Control Agency

Multi-Front Response Begins

By Paul Rosenberg, Senior Editor

Polluting industries and their allies pulled off a coup at the nation’s top regional air quality agency on March 4, firing the long-time executive officer in a closed door session.

Barry Wallerstein had served as executive officer at the South Coast Air Quality Management District since 1997. He was fired without explanation, and with just four days notice, when the closed door action item appeared on the AQMD board’s online agenda. The 7-6 vote reflected a new Republican majority on the board.

The incident prompted public shock and outrage, and a promise of state legislative action to restore majority representation to protect the region’s public health.

Clean air advocates at the meeting denounced the firing as “radical,” especially ill-timed and politically motivated. State Senate leader Kevin de León immediately denounced the firing as a “shameful action” that “is only the latest in a disturbing trend of dirty energy interests dismantling clean air rules that the public overwhelmingly supports.”

De León commended Wallerstein “for his outstanding leadership and commitment to protecting public health,” and pledged to “work to ensure the board returns to its core mission of improving and protecting air quality, rather than catering to oil industry needs.”

The following Tuesday, March 7, de León announced his intention to pass a law adding three more members to the board, a public health expert appointed by the governor and two environmental justice members appointed by state Senate and Assembly leaders.

The leadership coup—engineered in secret—follows a controversial vote this past December to reject a staff-proposed revision of the district’s nitrogen oxide reduction program (NOx RECLAIM) to meet clean air goals. The program had been three years in the making. The proposal would replace the program with a last-minute industry alternative, another back-room, business-backed plan.

But as has long been the case in California, the polluter’s influence has crossed party lines. This is reflected in the NOx RECLAIM vote, when San Pedro Councilman Joe Buscaino (a Republican-turned-Democrat) and Santa Ana Mayor Miguel Pulido, also a Democrat, both voted to approve the industry plan.

“I thought that Barry was doing a very good job at what he was trying to get accomplished on the major issues that were confronting AQMD,” Board member Joe Lyou told Random Lengths. “We finally have the technology we need to get to clean air now. And, it was thanks in part to his work and support for the development of that technology, and that he had, at least, a willingness to try to get the agency there.”

“As soon as we learned that this was something being considered by the board, we were absolutely outraged,” Sylvia Betancourt, of the Long Beach Alliance for Children with Asthma, told the board in her testimony.

Betancourt praised Wallerstein especially for his leadership in regulating the freight transport industry.

“When we were calling on the California Air Resource Board and on the EPA to address rail and their negative impact on our communities who were on the front lines, it was AQMD and through Dr. Wallerstein’s leadership that we were able to challenge industries who were not doing anything to protect our communities,” Betancourt said. “When you make that decision… your name will be etched on the lungs of our community members.”

“When Barry was dismissed from his position, it raised a lot of questions, doubt, uncertainty, and certainly, anger, a lot of anger,” Betancourt told Random Lengths afterwards. “A lot of work has been going into this over many years, and they got rid of that in one meeting.”

There is a great deal they were ignoring, Betancourt said.

“There is a definite link between the kinds of decisions they make and the impact it has on communities in Long Beach, Wilmington, San Pedro, along the 710 corridor, and out through the inland valley,” she said. “They make these decisions, but don’t have to live with or experience the consequences directly.”

Andrea Hricko, professor of preventive medicine at USC, presented comments on behalf of 19 scientists from USC, UCLA, UC Irvine and Cal Tech.

“We have always respected Dr. Barry Wallerstein’s commitment to promoting the health and welfare of Southern California,” Hricko said. “For decades, his leadership and vision have helped to improve air quality and health for millions, but we still do not have healthy air to breathe in the Southland, and the job is not done.”

“We are very upset, we have worked closely with Dr. Gary Wallerstein and his staff for decades,” said James Provenzano, president of Clean Air Now, in his testimony. “A strong economy is not mutually exclusive of strong regulation. Quite the contrary, we have the lowest per-capita energy use in the country, and our economy is the sixth largest in the world. Stop using this specious argument that strong environmental policy hurts business. It is the exact opposite.”

Indeed, the AQMD has repeatedly analyzed the costs and benefits of its regulations using an extensive, sophisticated model covering every sector of the local economy—94 occupations in 19 sub-regions in 2007. It has always found that the benefits far exceed the costs. Reporting on the 2007 Air Quality Management Plan, AQMP, Socio-Economic Report, Random Lengths noted:

While industry costs for new pollution control measures will range from $2.0 to $2.7 billion per year, benefits will top $14 billion, according to the AQMP’s socioeconomic report prepared under the supervision of Dr. Elaine Chang, deputy executive officer for Planning, Rule Development and Area Sources.

“It’s always easy to quantify [industry] costs. We’re trying to quantify the benefits as well,” Chang explained. “We can see the ratio [of benefits to costs] is 7 to 1, so society is bearing the costs of not internalizing the economic costs of polluting.”

Of course, businesses will pass on most increased costs to customers. But these costs will more accurately reflect the true costs of production, transportation and distribution. And they will be far less than the costs born by the public today.

This is the fundamental reality of the economics of clean air regulation—a reality that the worst-polluting industries have done everything in their power to distort and deny. Above all, they’ve repeatedly sought to mis-portray the costs of clean air as resulting in job loss, when the most polluting industries, such as oil refineries, have high profits and relatively small workforces.

They haven’t convinced the economists, scientists, public health experts or those suffering from dirty air’s health impacts. But they have convinced the business community leadership, as reflected in the parade of testimony against reconsidering the December RECLAIM vote, the AQMD agenda item immediately preceding Wallerstein’s dismissal. This included representatives from the Los Angeles Area Chamber of Commerce, California Hispanic Chamber of Commerce, Wilmington Chamber of Commerce, Southern California Business Coalition, and others, along with Chevron, Western States Petroleum Association, and Independent Petroleum Association.

“It’s taken three years to adopt these amendments,” said Elizabeth Warren of Future Ports in defending the December decision, “The board was dutiful and reasoned in its authority and responsibility to make a decision on this policy.”

Those two false claims were echoed repeatedly by other business groups.

“The plan that was ultimately adopted by the board was not the result of a three-year process, it was something that was introduced the day of the board vote,” Natural Resources Defense Council lawyer Morgan Wyenn pointed out.

Earthjustice lawyer Adrian Martinez agreed.

“The AQMD at the last minute adopted a Western States Petroleum Association plan for their pollution program, which was not supported by the extensive record before the agency,” he told Random Lengths.

On March 9, Earthjustice and NRDC filed suit to block the plan, representing three other groups as well.

“This suit challenges the failure of the air district to deliver on the most important smog fighting regulation in the agency’s jurisdiction in the last decade,” Martinez said.

The suit’s claims involve the plan’s substantive shortcomings, in violation of state law, as well as the flawed procedure, calling for a declaration that “the approval of the industry proposal was arbitrary and capricious.”

The suit was only filed after the reconsideration vote failed. That vote, in turn, reflected pressure from the State Senate, as well as the California Air Resources Board, which underscored the inadequacy of the Western States Petroleum Association plan.

On January 7, Air Resources Board’s Executive Officer Richard Corey wrote the AQMD to inform them that “ARB’s preliminary staff assessment is that the amendments would result in an air quality management plan (AQMP) we cannot approve,” and he went on cite several different provisions of California state law which the plan appears to violate.

The RECLAIM program began in 1993, replacing specific existing and planned regulations with a “cap-and-trade” system that allowed polluters to choose their methods of compliance — including the purchase of credits from others to offset their own pollution. In theory, it’s supposed to produce the most economically efficient means of reducing pollution. By law it’s supposed to produce the same amount of reductions as would be achieved by requiring the use of the “best available retrofit control technology” [BACRT]. However, the program has been plagued by an excess of credits, making them far too cheap, crippling the incentive to cut pollution.

“Certain industries have just hoarded or bought a lot of credits rather than installing pollution control equipment,” Martinez said. “The best example of that is the refineries where they’ve saved hundreds of millions of dollars since 2007 by not installing equipment on their stacks and the various things they own and operate, and what the end result is they’re still responsible for a lot of emissions.”

Adjustments have been made before, but they’ve fallen far short. The recent 3-year process resulted in a plan to “shave” the outstanding credits by 14 tons per day (tpd) from 2016 through 2022, starting with 4 tpd in 2016. The staff plan also called for removing credits from the market when the facility holding those credits shuts down. The Western States Petroleum Association plan called for 12 tpd reduction, starting very slowly, only reaching its first 4 tons cut by 2019, and deferring the shutdown credit proposal for further study. But the Earthjustice/NRDC lawsuit points out that the BARCT-based standard should have required an even sharper cut—17 tpd—in order to comply with California law.

As things stand now, there’s deep uncertainty about what lies ahead. The secretive moves of the past few months portend even more to come.

“All these things are connected, and they’re all happening behind closed doors, and were just getting glimpses of them as things are coming to the public,” like Wallerstein’s firing, Wyenn said. “It really just feels like a major foreshadowing of what’s to come, given that we know that right around the corner in the summer is the AQMP for ozone, so it’s kind of like this ominous foreshadowing situation.”

The RECLAIM decision will directly impact the ozone AQMP—just one of the reasons guiding AQMD staff, which the board chose to ignore.

At the same time, community environmental justice activists are more knowledgeable than ever in fighting back. Jesse Marquez, founder of Communities for a Safe Environment, epitomizes this development. In his comments before the vote to fire Wallerstein, he spoke directly to new board members regarding “violations of environmental, public health, safety and welfare laws.” Communities for a Safe Environment did some legal research into the different laws that the board seemed to have ignored in its RECLAIM vote.

“The protection and care of the environment, public health safety and welfare are rights granted and regulated under state and federal law,” Marquez said.

But “private business and industry have no rights under any state or federal law to violate the protection and care of the environment public health and safety and welfare,” and the board has no authority to violate those laws.

“The board has no authority under any state or federal law to use employment, the economy, or cost as the sole basis for rejecting limiting, canceling, or denying existing air pollution rules and regulations, or new proposed stricter rules and regulations and programs,” he noted.

Afterwards, Marquez explained his intent to Random Lengths. Board members are often appointed with no background in the body of laws and regulations governing the realm of responsibilities they’ve been given. And, there’s no special training they’re given to get up to speed.

“So, I wanted to remind them that they’re under certain legal mandates,” he said.

Also, that the public knows about those mandates, and has the capacity to do its own research, and/or to gain expert advice, when needed.

“I may not have a PhD physicist on staff, but I know several PhDs I can call to give advice, and that’s what we do,” he said. “Something has changed over the years, so 15 to 20 years ago, we, the public, my parents, grandparents were not very knowledgeable about applicable rules and regulations that are out there, under various California laws and regulatory agencies. But my generation, and my sons have grown up with me knowing that there are specific laws, rules and regulations, that we are familiar with, and that when we give an opinion, or we present information, or facts, we are fully capable of doing excellent research.”

So, on the one side, there’s a phalanx of business interests repeating a well-manicured set of talking points that just don’t square with the public record, with public health research, with economic analysis, or with the body of existing law. Acting in the shadows, they’ve temporarily managed to gain control of the AQMD, but they’re fighting an increasingly aroused public, as well as the laws of nature, California and the United States.

The coup may be over. But the battle has only just begun.

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