After lengthy discussion and significant tweaking on Tuesday night Oct 4, the Benicia City Council unanimously approved a Resolution to Deny Valero’s proposal to build an offloading facility for oil trains. After a long list of whereases, the document indicates “findings” that back up the Council’s unanimous September 20 vote to deny Valero’s permit.
Anticipating litigation, Council members spent hours reworking the findings submitted by City Attorney Heather McLaughlin, making every effort to approve a document that would be “bullet-proof” in a court of law.
In the draft submitted to Council by staff, a number of the findings pointed out serious impacts both uprail and onsite. Council wordsmithed the document to move suggested “findings” that relate to OFFSITE rail impacts to a section of the document that was “for information only.” That section is included only to alert State and Federal governmental officials and regulators that more needs to be done at those levels to reign in unsafe and polluting transport of North American crude oil by rail.
The remaining findings relating to ONSITE impacts are extensive, and should be more than adequate to stand up in any possible court challenge.
The edited version of Council’s Resolution is not yet available as of this writing. The draft copy is available here. Minutes of the Council meeting have not yet been posted, but VIDEO of the Oct 4 meeting is available on the City’s website, here. The Council’s discussion begins at 2:19:10 on the video and goes for an hour and a half, until the end of the meeting, at 3:49:34.
Incredible: “The permit is therefore approved by operation of law.”
In yet another bizarre legal maneuver, Valero’s attorney John Flynn sent a letter to the Mayor and members of the City Council on October 3, claiming that by various acts of commission and omission, the City Council on September 20 failed to properly deny Valero’s permit, and that therefore the permit is “approved by operation of law.”
The logic is twisted, but stick with me.
Flynn is claiming that “the City Council’s action of September 20 violated both state and federal law” on a variety of grounds:
Timing – Valero claims that a decision with proper findings in support of denial was required by September 20, but the Council sent staff back to revise the findings in the draft resolution of denial.
Council members’ statements – Valero claims that Council members were required to verbally state the grounds upon which they voted to deny the project, and that they ONLY stated concerns about rail-related impacts, which Valero continues to claim are preempted from consideration under federal law. Note here that Valero re-states its failed argument that even ON-SITE rail impacts are preempted.
Reliance on a letter received on September 20 – Valero claims that the City may not rely on information in a letter from the law firm Adams Broadwell Joseph & Cardozo in framing its arguments for denial. Poor Valero states that it (and the public) didn’t have a chance to rebut the letter. This from the company which sent two last-minute unrebuttable letters which City staff included in the Council’s agenda packet!
Reliance on the Surface Transportation Board letter – Valero claims that Council relied on the STB’s dismissal of Valero’s petition in its decision, and that Valero and the public never had an opportunity to comment on the STB’s decision. Valero demands that the City not refer to anything in the federal agency’s decision when drafting findings for denial.
Council’s request for staff to edit its draft resolution of denial – Valero claims that any editing of the draft resolution would amount to “post hoc rationalizations.” Baloney. It’s done all the time.
The letter goes on and on, but I will leave it to the City Attorney and others to flesh out Valero’s twisted bullying tactics.
IMPORTANT: The letter concludes by foreshadowing a lawsuit against the City:
“The transcript of the September 20 hearing will no doubt clearly establish for a Court that the only grounds invoked by the Council for denying Valero’s application were rail-related grounds, and that any other grounds invoked in the written findings proposed by staff and by Adams Broadwell are no more than baseless afterthoughts, in a desperate bid to deny Valero’s permit application, despite the lack of any legal or factual bases for such a denial.”
Federal action seen as boost to local, state control over projects
By Brian Nearing, Thursday, September 29, 2016 10:03 pm
ALBANY > A federal ruling on a oil-by-rail facility in California could hand state and local officials in New York and across the country a powerful legal tool to oversee the projects, which have been controlled primarily by federal rules.
The federal Surface Transportation Board this month sided with officials in Benicia, a small city near San Francisco, in a dispute with an oil refining company over a proposed storage terminal for crude oil brought in by tanker trains. The Valero Refining Company had argued it was exempt from a city denial because it was functioning as a rail carrier, and governed by federal transportation rules — a legal concept called “preemption” — but the federal board rejected the claim.
“Valero is not a rail carrier, nor is it acting under the auspices of a rail carrier,” according to the federal decision. Critics of oil train traffic directed in recent years to two oil terminals at the Port of Albany hailed the ruling as a victory for more state and local control.
“This puts the state Department of Environmental Conservation in a very strong position to require the oil terminals to explain the full impacts of their operations,” said Chris Amato, an attorney for the not-for-profit environmental group Earthjustice.
This month, the DEC announced it was requiring one terminal operator, Global Partners, to answer additional environmental questions on its request to construct a crude oil heating terminal that could be used to process Canadian tar sands oil.
“Nothing in the opinion suggests that DEC’s current course of action with respect the Port of Albany should be altered,” a DEC statement said.
Critics of earlier DEC environmental approvals for the Global and Buckeye oil terminals have been urging the state to rescind its approvals, but the state had responded that such authority rested with the federal government, not the state.
Ruling by Little-Known Federal Agency Paves Way for Communities to Say No to Oil-by-Rail
By Justin Mikulka, September 28, 2016 – 03:58
Oil tank care behind a fence with sign reading ‘Think first.’ Main image credit: Justin Mikulka
The community of Benicia, [California,] in the crosshairs of history, made one of those decisions that will make a difference for the country. They stood up and said the safety of our communities matters.”
That was Yolo County Supervisor Don Saylor talking to The Sacramento Bee about the vote by the Benicia City Council to deny a new oil-by-rail facility that oil company Valero was seeking.
But that vote would have been meaningless if not for a recent decision on September 20 by the Surface Transportation Board (STB) that gave Benicia the legal authority to have some say over what happens within its borders.
Created in 1996, the STB is a federal agency which serves as “an independent adjudicatory and economic-regulatory agency charged by Congress with resolving railroad rate and service disputes and reviewing proposed railroad mergers.”
The STB decision helped clear up some of the gray areas around the issue of “pre-emption,” in which railroads are not subject to any local or state authorities or laws because local and state laws are “pre-empted” by federal law.
In 2013 the STB ruled in favor of Norfolk Southern Railway Company, saying once again that federal pre-emption of state laws protected the rail company from lawsuits filed in the state of Virginia.
The basic idea of pre-emption is that for interstate commerce to work, the federal government needs to be the sole regulator of railroads.
As we have reported previously on DeSmog, pre-emption can effectively place rail companies above local law. This has led to developments such as the case of Grafton, Massachusetts, where the construction of the largest propane transloading facility in the state occurred without the need for local approval, construction permits, or even environmental review.
Regarding the Grafton facility, the New England Center for Investigative Reporting wrote that, “Residents were dumbfounded: The location was in the middle of a residential neighborhood, less than 2,000 feet from an elementary school and atop the town’s water supply.”
This above-the-law approach has served rail companies well. And until the recent STB decision, it also appeared to protect oil companies who were moving oil by rail.
But this latest decision about Benicia appears to deliver a real blow to oil companies when it comes to oil-by-rail transfer facilities. Since the companies who receive the oil from the rail cars aren’t railroads, the STB ruled that they are not protected by federal pre-emption. In the decision the STB refers to Valero as a “a noncarrier” which is why the STB ruled they are not able to claim pre-emption.
This allowed Benicia to say no to an oil-by-rail facility in their community. And it has also changed the discussion about this industry as a whole.
San Luis Obispo County, California, has now delayed further the decision about a new oil-by-rail facility in order to consider the latest STB ruling.
Ethan Buckner was one of the organizers for environmental advocacy group Stand, which was working to stop the Benicia facility.
“This is a victory for the right of communities to say no to refineries’ dangerous oil train projects. The federal government has said once and for all that there is nothing in federal law that prevents cities from denying these oil companies’ dangerous rail projects,” Buckner said. “The oil industry keeps telling communities they have no right to say no to oil trains, but this ruling once and for all refutes this.”
“We’re pleased with the decision and the implications it will have across the country,” said Prange. “This issue is live in a number of sites across the country. This is definitely a decision that I think cities in other states will be looking to.”
They are definitely paying attention in San Luis Obispo County, as well as in Albany, New York.
Albany is the largest oil-by-rail hub on the East Coast.
Opponents of its oil trains recently had cause for celebration. On September 16, the state’s Department of Environmental Conservation announced that the two companies operating oil-by-rail facilities at the Port of Albany would now be required to undergo full environmental reviews before the agency would renew the companies’ permits.
Chris Amato is a lawyer for Earthjustice who has been working on this issue for years. He believes the STB decision supports what Earthjustice has been saying all along about Global Companies, which owns one of Albany’s oil-by-rail facilities.
“The decision by the Surface Transportation Board confirms what we have been saying since 2014: that Global’s claim that state regulation of their operations is pre-empted by federal railroad law is simply wrong,” Amato explained to DeSmog. “Global can no longer attempt to shield their operations from scrutiny under their flawed legal theory.”
Opponents of the Albany oil-by-rail operations have been asking the state to step in for years, but the state has also hidden behind the issue of federal pre-emption. In 2014 the Albany Times Unionreported that “Gov. Andrew Cuomo has been deflecting calls for the state to block the trains, saying rail transportation is controlled by the federal government, not the state.”
It would appear that the STB ruling negates New York’s current position and offers an option for the state to have authority over oil-by-rail facilities in Albany.
While the amount of oil moving by rail is roughly half of what it was two years ago, that is mostly due to the current low price of oil. And it hasn’t stopped oil companies’ continued efforts to build out more oil-by-rail infrastructure.
Meanwhile, oil trains continue to derail and explode, as happened in Mosier, Oregon, in June, and opposition to the oil-by-rail industry continues to grow.
This STB decision appears to be a game-changer in the oil-by-rail story. With it, perhaps now more politicians will agree that “the safety of our communities matter” — much more so than oil company profits.
After lengthy discussion and significant tweaking on Tuesday night Oct 4, the Benicia City Council unanimously approved a Resolution to Deny Valero’s proposal to build an offloading facility for oil trains. After a long list of whereases, the document indicates “findings” that back up the Council’s unanimous September 20 vote to deny Valero’s permit.
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