Sunday, July 12, 2020
Home News Carson Carson, Tesoro Enter Agreement

Carson, Tesoro Enter Agreement

By Lyn Jensen, Carson Reporter

After recently declaring a fiscal emergency, the City of Carson announced July 6 its commitment to a 15-year “Community Benefits Agreement” — essentially, a peace treaty — with the oil company Tesoro.

City officials believe the arrangement will provide Carson with a projected total of $45 million for what the city calls “community mitigation projects.”

“The city and Tesoro have entered into separate agreements resolving all outstanding disputes,” a press release from the city stated. “The value of these other agreements to the city is $36 million.” The latter accounts for most of the money.

As for the remaining $9 million, the agreement describes it as tied to milestones surrounding a Tesoro project to integrate the Carson and Wilmington refineries to form a Tesoro Los Angeles Refinery. The project’s environmental impact report, or EIR, was disputed by the city earlier this year.

“The [Community Benefits Agreement] is designed to provide a stable source of funding over a 15-year period,” states a July 5 staff report to council.  “It is not uncommon for refineries to make … payments to their host communities.”

The staff report cited El Segundo as an example.

The agreement follows the council declaring a fiscal emergency at its June 20 meeting. At that time, staff suggested the council generate an additional $350,000 of revenue, including lifting the cap on the Utility Users Tax, reducing service levels and adding or increasing revenue sources.

Carson has been experiencing financial difficulties since the Great Recession of 2008. In 2011 redevelopment agencies were dissolved statewide when the state transferred redevelopment funds to the public schools to close the state budget deficit (partly due to the Great Recession).

According to city documents, that action cost Carson $30 million in redevelopment funds annually. Since 2011 the city has deferred street maintenance  and reduced its workforce by 20 percent, firing 60 employees.

The fiscal emergency is not simply due to lack of redevelopment money. Revenue exceeded expenditures between the fiscal year 2010-11 and fiscal year 2012-13. Since then, the city’s expenditures have exceeded revenue and the city’s reserves are rapidly dwindling.

In 2009, the council granted a franchise to Tesoro for three non-public utility pipelines. A dispute over the pipelines arose after Tesoro purchased the refinery in 2013. A fourth pipeline was discovered that had not been properly documented.

“The parties hereby agree that, for the calendar years 2017 to 2031, Tesoro shall pay to Carson the full amount of electricity users tax [and] gas users tax,” the Community Benefits Agreement states, waiving the requirement that the council would need to declare a fiscal emergency to get such payments.

The Community Benefits Agreement would also amend the oil pipeline franchises to increase the franchise fees, subject to an annual Consumer Price Index adjustment within the 15-year term.

“The City and Tesoro have been involved since 2013 in discussions over a series of issues and disputes,” the July 5 staff report states. “The major disputes involve the environmental impacts of the integration of the Carson and Wilmington Refineries, the use of a 60-acre parcel for a trucking and container storage yard and the transfer of oil pipeline franchise agreements.”

It further states South Coast Air Quality Management District prepared an EIR for the refinery integration project, but Carson, concerned over the lack of community benefits, threatened to sue, claiming the EIR was deficient. Tesoro disputed the claimed deficiencies in the EIR and has since agreed to mitigate the city’s concerns.

The Carson City Council on July 5 voted unanimously to approve the community benefits agreement and transfer the pipeline franchises to Tesoro.

A separate resolution, passed at the same meeting, resolved a years-long zoning and permit dispute over Shippers Transit Express on Sepulveda, concerning a lease on Tesoro property. It involves a retroactive payment of $900,000 to the city for development impact fees and $250,000 annually for the next two years. The agreement calls for closing the truck yard in 2018 and putting in four petroleum storage tanks.

For Tesoro’s Los Angeles Refinery Integration and Compliance Project, the company plans to invest $460 million in facility improvements to upgrade its Wilmington and Carson refineries. The project aims to reduce greenhouse gas emissions, in what the South Coast Air Quality Management District estimates is equivalent to removing 13,500 daily passenger vehicles from local roads.

Construction is expected to begin later this year, with an anticipated completion date of March 2021.

The project would connect the refineries by pipelines, according to a city document, to allow the closure of the older gasoline production facility in Wilmington, switching production to the newer and more efficient gasoline production facility in Carson.

Carson states it will deposit the payments from Tesoro into the general fund to provide a series of existing and future community benefit programs, including a green streets program for compliance with the Dominguez Watershed Plan.

The city sought a stable funding source for its stroke center, emergency response center, bike paths, street resurfacing, and an environmental capital improvement program to renovate street landscaping medians.

As part of the Community Benefits Agreement, Tesoro also agreed not to build or operate a hydrofluoric acid alkylation unit at the integrated refinery.

Concerns about hydrofluoric acid may be traced to an explosion at the Torrance refinery in 2015, when debris narrowly missed a tank. If the tank had ruptured and the acid it contained had been released, a toxic cloud could have killed as many as 330,000 area residents, including many in southern and western Carson.

Previous articleNeighborhood Council Follies
Next articleOpiate Crisis
Lyn Jensen
Lyn Jensen
Lyn Jensen has been a freelance journalist in southern California since the 80s. Her byline has appeared in the Los Angeles Times, the Orange County Register, the Los Angeles Weekly, the Los Angeles Reader, Music Connection, Bloglandia, Senior Reporter, and many other periodicals. She blogs about music, manga, and more at lynjensen.blogspot.com and she graduated from UCLA with a major in Theater Arts. Follow her on Twitter, LinkedIn, or Facebook.

Most Popular

Summer Al Fresco Dining Coming Soon

By Gretchen Williams, Dining and Cuisine Writer Life is challenging this summer, and the living is getting easier, by...

Random Letters: 7-9-20

Defunding the Police “Defunding” the police is the latest version of the same old, tired, Democrat ploy to rob...

DREAMers Get To Stay for Now

By Sarai Henriqulez, Editorial Intern Anais Franco was just nine years old when she first stepped foot on American...

Viva Pat Carroll!

San Pedro Art Community Loses Great Ally By Ron Linden, Contributor; Andrea Serna, Arts Writer; Melina Paris, Editorial Assistant

Recent Comments

Kevin on Icarus Falls
DAVID J LEE on Think: George Floyd
M Mackey on Think: George Floyd
Michael S. Motta on Think: George Floyd
Thomas "HOUSE" Houchens on Think: George Floyd
Eliath Mena on Think: George Floyd
Deidre Powell on Think: George Floyd
Marcia Ladymgirl on Think: George Floyd
Jennifer L on Think: George Floyd
Carlos Fisher on Think: George Floyd
Jose "cheMMa" Rodriguz on Think: George Floyd
Aniza Thomas on Think: George Floyd
David Seay on Think: George Floyd
Marc LJ on Think: George Floyd
andre edwards on Think: George Floyd
Terelle Jerricks on From Pop Culture to Cop Culture
Sharon Hislop on Think: George Floyd
Fetteroff on Think: George Floyd
Raul Acevedo Jr. on Think: George Floyd
Mel Grayson on Think: George Floyd
Terelle Jerricks on A Virtual World of Events 
Alice r. Knoop on Lung Health Tips for COVID-19
Melina Paris on Take me to Sardine
Joshua E Chambers on Take me to Sardine
Chad Dorchester on Take me to Sardine
Terelle Jerricks on Change Won’t Be Televised
Melina Paris on Take me to Sardine
Melina Paris on Take me to Sardine
Melina Paris on Take me to Sardine
Bob Kohler on About
Judie M Barker on About
Kim Kaufman on Staff
Kim Kaufman on Staff
Vivian Morales on From War to Lowrider
Robin Doyno on Staff
Publisher on About
Joe Stackhouse on Advertise
Marshariki Haylock on A Stabbing in San Pedro
CARRIE MENDOZA on A Stabbing in San Pedro
Martin Palmiere EMC(SW) ret. on Trouble on the Iowa
Martin A.Palmiere EMC(SW) USN(ret.) on Trouble on the Iowa
John H Winkler on Frequently Asked Questions
J. McVey on Staff
Malou Mariano on Tampering and Collusion
Terrell Williams on The New Gap Band Fills The Gap
Alton C . Thompson, Ph. D. on About
Harold Ericsson on Letters to the Editor
Hillbinkel on Trouble on the Iowa
Ian Gordon on KKJZ Leaves CSULB Campus
larry lebedin on KKJZ Leaves CSULB Campus
Joseph Bianco on Frequently Asked Questions
Deborah Steed on Zerby Family Finds Solace
Don Griffin on Rosenberg
Pete on About
Anne Marie Knudsen on Clem Pennington is the Whole Package
Terelle Jerricks on About
Lyn Jensen on Go Retro with Records
Steven R. Heldt on Fig Trees Are Like Democracies
Joanne Sims on Peacocks, Paseo, Politics
Dave Borst-Smith on Peacocks, Paseo, Politics
Charles Traupmann on The Buscaino Report:
james P. Allen on Across the Great Divide
Allyson Vought on Across the Great Divide
PBinLostAngeles on RL NEWS Roundups: June 14, 2016
davehall on Voter Guide
Chris formica Gringos Tacos on Food Truck Blues
Random Lengths News on Iowa Fever
Tinisha Rodrique on IMG_1761
polos fred perry on Less Than a Side Show
cheap soccer jersey on Less Than a Side Show
le mahjong gratuit on The Surrealness of Knives and Breast
Harry and the Gang on Sherlock Holmes at the LB Playhouse
neufert architect s data pdf on IMG_1761
sewing machine reviews on Annie at the Warner Grand