Category Archives: Negative campaigning

SF Chron: Attorney associated with Valero-funded PAC connected to ‘faux-ilition’ scheme targeting oil refinery regulations and penalties

[Note from BenIndy Contributor Nathalie Christian: An attorney associated with the firm a Valero-funded PAC has used throughout allegedly misleading campaign efforts in Benicia elections has been exposed as a key figure behind a ‘phony coalition’ some say was manufactured to oppose refinery regulations and penalties. Watchdog and advocacy organizations describe the coalition – dubbed a ‘faux-ilition’ by Calpeek – as a Big Oil–funded scheme to make industry opposition to a proposal to cap oil company profits appear grassroots-driven. (Industry leaders deny the allegation.) Benicians may recognize the name of the firm – Nielsen Merksamer – as well as the name of the attorney in question from Roger Straw’s reporting on the Valero-funded PAC’s efforts to influence local elections. (This PAC was previously known as ‘Working Families’ and more recently as ‘Progress for Benicia.’) Nielsen Merksamer was also behind a letter threatening litigation over a Benicia Open Government Commission’s candidate forum in 2018. Nielsen Merksamer’s clients include Valero Energy Corporation of course, as well as other Big Oil giants BP, Chevron, ConocoPhillips and Exxon.]

How a network of ‘phony’ groups sprung up to fight Newsom’s oil regulations

San Francisco Chronicle, by Dustin Gardiner, June 19, 2023 (Updated June 20)

Groups with names like Californians Against Higher Taxes sprung up to oppose Gov. Gavin Newsom’s plan to penalize oil companies. Advocates say one man is behind three of them.

California lawmakers were on the verge of passing Gov. Gavin Newsom’s proposal to allow the state to cap the profits of oil companies when a trio of advocacy groups with innocuous-sounding names went on an advertising blitz.

The groups — nonprofits that call themselves Californians Against Higher Taxes, Californians for Affordable and Reliable Energy and Californians for Energy Independence — campaigned against Newsom’s measure in a blizzard of social media posts and television ads. The groups said that further regulation of oil refineries would make the state more dependent on foreign crude oil imports or would raise the cost of gas for consumers, dubbing the proposal “Gavin’s gas tax.”

Those groups also billed themselves as coalitions of thousands of concerned taxpayers or small-business owners. Their ads and websites are rife with stock images of everyday-looking people.

But the organizations, according to corporate and lobbyist filings, weren’t created by average Californians or small businesses. One attorney from the North Bay, who has a long history of working with oil companies and trade associations, was central in organizing all three groups.

Steven Lucas, a San Rafael attorney who specializes in political law, is listed as the CFO and secretary for two of the groups, Californians for Affordable and Reliable Energy and Californians for Energy Independence. He also held the same roles with Californians Against Higher Taxes until last year.

Lucas did not respond to emails and voicemails requesting comment. The groups he operated were heavily funded by oil refineries and the Western States Petroleum Association, an industry trade group.

Environmentalists and consumer advocates said the advertising campaign is an example of how the oil industry used “astroturf” or “front” groups to try to kill Newsom’s proposal using misleading tactics.

It’s designed to create the perception that there’s a grassroots movement that’s against oil industry accountability. These are not real groups; these are phony groups created for the purpose of preventing the oil industry from facing accountability for its high prices and environmental crimes.” Jamie Court, president of Consumer Watchdog

“It’s designed to create the perception that there’s a grassroots movement that’s against oil industry accountability,” said Jamie Court, president of Consumer Watchdog, an advocacy group that pushed to cap soaring gas profits. “These are not real groups; these are phony groups created for the purpose of preventing the oil industry from facing accountability for its high prices and environmental crimes.”

Lawmakers ultimately passed Newsom’s proposal, though it was significantly scaled back after he got a lukewarm response from some moderate Democrats amid the oil industry’s ad push.

The bill Newsom signed into law gives state energy regulators the authority to place a cap on oil refiners’ profits in California — and to set the amount. They also now have the authority to fine companies that exceed the cap and require them to disclose information about their operations and prices.

The Democratic governor’s original proposal would have gone further by requiring legislators to set the amount of the profit cap. Still, the bill that passed was a major victory for environmentalists and consumer advocates who had failed, for decades, to pass measures designed to combat California’s highest-in-the-nation gas prices.

As lawmakers considered Newsom’s measure, the oil industry spent more than $9.4 million in the first quarter of 2023 on lobbying and public-influence campaigning, largely centered on Newsom’s oil profit proposal. About $5.2 million of that money was funneled into the three advocacy groups with ties to Lucas.

Combined, the oil-industry affiliated groups have run 568 social media ads on Facebook and Instagram since December, according to data from parent company Meta.

The ad tsunami started in late 2022, quickly after Newsom called a special session for lawmakers to consider measures to combat skyrocketing gas prices consumers were paying at the pump. He accused the oil refiners of “price gouging” Californians as the price of a gallon of regular gasoline soared to a statewide average of $6.42 last fall.

But opponents of the measure said the accusation that they used “astroturf” or deceptive tactics to stoke a perception of opposition is unfair and negates the concerns of a broad coalition of groups.

They said many business interests, including the California Chamber of Commerce and agricultural companies, also had concerns that Newsom’s approach, including the proposal that lawmakers ultimately adopted and his more aggressive earlier pitch, could have the unintended consequence of driving prices up if it causes oil companies to produce less gas in California.

In addition to Lucas, the three advocacy groups are headed by business association executives. Californians for Energy Independence listed Allan Zaremberg, the former leader of the state Chamber of Commerce who died this year, as its CEO. Californians for Affordable and Reliable Energy lists its CEO as Robert Lapsley, president of the California Business Roundtable, another association of business groups that includes oil companies.

Californians Against Higher Taxes, which was organized by Lucas and the law firm where he works, is now led by Jennifer Barrera, CEO of the Chamber of Commerce; and Thomas Hiltachk, a political attorney. Hiltachk did not respond to a request for comment.

Kevin Slagle, a spokesperson for the Western States Petroleum Association, said the notion that the opposition campaign cloaked its efforts is laughable. He said the groups had to report their spending, and that the effort through third-party groups was combined with ads directly funded and managed by oil companies and WSPA.

“It’s disingenuous to call these efforts fake. They’re very real and they’re based on legitimate policy concerns,” Slagle said. “Our political system has so much transparency built into it.”

Of the two dozen oil companies and trade associations that poured more than $9.4 million into California lobbying and influence campaigns, Chevron contributed more than half of that total. The company, the largest oil refiner in California, spent $4.9 million, including $3.63 million it contributed to Californians for Energy Independence.

Ross Allen, a Chevron spokesperson, defended the company’s lobbying efforts and suggested “attacks” on oil refining in the state are putting the supply at risk. He said California has volatile energy markets, in part, due to its clean-fuel standards that cut off its gas supply from the rest of the country.

“Chevron works hard to educate policymakers and the public about how fragile California’s energy markets really are,” Allen wrote in an email.

But Melissa Aronczyk, an associate professor at Rutgers University in New Jersey who studies the impact of public-relations campaigns on climate change policy, said the playbook that oil companies used by deploying “astroturf” groups in California is hardly new. She said the difference is that environmentalists have become more adept at uncloaking such tactics.

“People have much more awareness about greenwashing than they did ever before,” she said, using a term for marketing that’s intended to mislead the public about environmental impacts.

“[…] the tactic of using outside groups with seemingly innocuous names is designed to trick voters who might be more skeptical of advertising if they could see it’s paid for by oil companies.”

Aronczyk said the tactic of using outside groups with seemingly innocuous names is designed to trick voters who might be more skeptical of advertising if they could see it’s paid for by oil companies. In California, candidates and ballot measure campaigns must disclose their major donors in fine print at the bottom of ads. But that same disclosure requirement doesn’t apply to ads for issue-based campaigns that aren’t tied to an election.

She likened the “puppet campaign” strategy to the marketing tactics employed by other embattled industries, including tobacco companies and prescription drug firms, which bankrolled third-party advocacy groups to fight regulations targeting cigarettes and the proliferation of opioid drugs, respectively.

“They really are running scared, and that’s why they’re resorting to these tactics,” Aronczyk said. “It is a very short playbook, and it has been used for many decades.”

Indeed, Lucas, the attorney behind oil-industry-funded advocacy groups, is a partner at a law firm, Nielsen Merksamer, which also has a long history of working with tobacco companies to fight restrictions in California.

In 2017, two other attorneys from the firm were the treasurers of an advocacy group dubbed “Let’s Be Real” that worked with the tobacco industry in an unsuccessful attempt to overturn San Francisco’s law banning the sale of flavored tobacco and vaping products. Similarly, the firm played a major role in coordinating a failed referendum to repeal a 2020 statewide law that banned most flavored tobacco products.


Clean Politics and Valero – video from 2019 and 2022

Valero spokesperson refused to promise fair campaigns, Air District exposes Valero’s multi-year toxic emissions

At 2019 public presentation by Valero in Benicia, Paul Adler, Valero Benicia’s Director of Government Affairs and Community Relations, declined to respond to a question regarding the refinery’s interfering in local Benicia elections.

Benicia resident Andrés Soto was in the audience, and posed a question during Q&A. Recalling Valero’s malicious attacks in Benicia’s 2018 election, Mr. Soto posed a question: “You say you want to be a ‘good neighbor.’ Will you pledge not to conduct a similar negative campaign in the local elections in 2020, and let Benicians make their own decisions?” Mr. Adler’s refused to make the pledge.

The Valero funded PAC went on to mount a massive effort to buy the Mayor’s seat in 2020 – including misleading and demeaning ads, and has once again in 2022 spent large sums on phone polling, mailers and social media.

This video shifts midway to a March, 2022 Benicia City Council presentation by the Bay Area Air Quality Management District. At that meeting, air quality experts informed the city leaders and residents of serious huge multi-year toxic emissions violations heretofore unreported by the Valero Refinery.

See also, “City Leaders in Benicia not happy to learn recently that the Valero was emitting excessive amounts of hazardous chemicals for over a decade.


Benicia – PAC influence here worse than in Big Cities

The One Way in Which Our Wonderful Benicia’s Politics Are Worse Than Those of Big Cities

By Stephen Golub, Benicia Resident, October 31, 2020
Stephen Golub, Benicia

When my wife and I moved to Benicia, one major reason we did so is the wonderful sense of community here. Even during these terrible Covid times, this town’s warmth has continued to shine through. And though my fantastic neighbors and I don’t always agree about politics, our chats about them have always been friendly and civil.

It’s against this backdrop that this year’s mayoral campaign, namely the negative attacks on Council Member Steve Young by the Valero-backed PAC, Working Families for a Strong Benicia, has been so appalling. The many lies and distortions have apparently included blasting him for his legitimately receiving a publicly funded pension. What’s next? Denigrating someone for getting social security?

To be clear, before for I go any further: I recognize that Valero and its local workers have legitimate interests and that it donates to Benicia’s well-being in many much-appreciated ways. But while individuals who work for Valero here may arrange such contributions with the best of intentions, the corporation’s Texas headquarters is not funding them out of the goodness of its heart. Rather, it’s to influence perceptions of the company and thus increase its influence on our city.

If Valero were simply out to help, think of how many meals for hungry families impacted by the Covid economy or services for school kids could have been purchased with the nearly $400,000 that Valero and its allies put into tainting our politics in 2018 and 2020.

Furthermore, I respect Vice Mayor Christina Strawbridge’s devotion to Benicia. But I’m nonetheless disappointed that her disavowal of the Valero PAC’s attacks on Mr. Young have been so weak and late, largely confined to a couple of recent online candidate forums, and that she has sought to equate its massive spending with negative but much less impactful social media insults against her.

I also give her kudos for responding quickly and thoughtfully when I emailed her campaign about the PAC’s attacks on Steve Young. But meek disavowals by her do not make for a convincing rejection of its attacks on Mr. Young. And in view of the PAC’s strenuous support for her, they do nothing to reassure us about how she will deal with Valero if she wins.

All this brings me to how the PAC’s actions have been even worse than what I’ve seen in some big cities – namely, what I witnessed years ago working in New York City politics and government and later living in Manila (in the Philippines) and, most recently, Oakland.

Here’s how: I’ve never seen so much money spent to try to sway the votes of so few people, particularly through the lies and distortions about Mr. Young that the PAC has circulated in support of Ms. Strawbridge. Between 2018 and 2020, Valero’s and its allies’ attacks on candidates it opposes have worked out to about $25 per voter here, based on the roughly 15,000 citizens who cast ballots in our elections.

Now, don’t get me wrong. Politics in those much bigger cities can get dirtier than here. But purely in terms of per person expenditure, my admittedly imperfect memory can’t recall such great levels of funding pouring into a campaign.

My concerns go beyond what’s being spent, however, to what’s being bought or at least influenced if Christina Strawbridge is elected. PACs exist to advance specific interests. This is particularly concerning in Benicia, which has seen very recent disputes, especially crude-by-rail, over Valero’s operations. Steve Young has been much stronger on such matters.

What’s more, our state is being ravaged by climate change-facilitated fires. Benicia itself is threatened by them – recall the Vallejo fire last year and the toxic skies in recent months. Other refineries are converting to biofuel processing. California’s and potentially federal policies (pending the presidential election results) are shifting away from petroleum. In light of all this, Valero should be exploring with Benicia a gradual transition that protects its interests and especially those of its workers, not adding fuel to the fire of this great town’s politics.

I’ll note that the one issue that I’ve discussed (online) with Mr. Young involved my challenging his proposal earlier this year for indirect city support for Covid-impacted Benicia businesses – an idea about which, in retrospect, he might have been right. He was civil, polite and thoughtful in his reply.

In contrast, Ms. Strawbridge could have done much better in backing away from Valero’s backing. So can we, come Election Day, by voting for Steve Young.

Valero PAC submits 3 new financial disclosures, expenditures now over $209,000

By Roger Straw, October 30, 2020

On October 28, The Valero PAC reported total income and expenditures for the period October 18-25.

According to the report, the PAC received no new income and made no new CASH payments, but took on new UNPAID bills amounting to $8,500 for ROBO calls and Live Calls [p. 3 and p. 8].

Note that the form seems to show much more than $8500 spent.  Detailed expenditures show another $30,688 spent during this period for ROBO calls, Live Calls, & Mailers [p. 4], and another $6,500 spent during this period for Professional Services [p. 9].  This would seem to contradict the $8500 claim.  To sort this out is beyond my expertise.  For details, see the Form_460_Pre_Election_3.pdf.)

TOTAL EXPENDITURES in 2020: $209,399 to buy Benicia’s next Mayor.

INCOME for the period October 18 to October 25
This period Year to date
Monetary Contributions (International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, forgers & Helpers Local 549) $0 $25,000
Total Contributions $0 $25,000
EXPENSES for the period October 18 to October 25
This period Year to date
Cash payments $0 $99,333
Accrued, unpaid bills $8,500 $110,067
TOTAL EXPENDITURES $8,500 $209,399
Current Cash Statement
Beginning Balance $173,779
Cash receipts $0
Cash payments $0
Ending Balance $173,779