California legislators are considering giving Valero Energy Corp. hundreds of millions of dollars to cover refinery maintenance costs in a bid to prevent the closure of a San Francisco-area fuel plant.
Under such a deal, the state would pay Valero to continue operating its Benicia refinery, according to people familiar with the negotiations who asked not to be identified discussing private deliberations. The plant is slated to close by April, the latest in a string of recent California fuel-plant shutdowns.
Between $80 million and $200 million of state funds would likely be earmarked for routine maintenance work, although the terms of the arrangement could be subject to change, the people said. Maintenance is one of the biggest operating costs for refiners and the expense of major overhauls typically performed every four or five years can be a catalyst for closure. Discussions with lawmakers over keeping the Valero facility open were held as recently as this past weekend. Absent a deadline extension, legislators have until late Tuesday to submit bills for consideration.
Valero shares briefly dropped on news of the talks but have since recovered and were up 2.8% to $161.77 at 1:10 p.m. in New York, making it the day’s best-performing oil stock in the S&P 500.
Valero didn’t respond to requests for comment. California Governor Gavin Newsom’s office declined to comment while representatives for state senate and assembly leaders didn’t respond to inquiries.
Newsom has in recent months taken a new tack with refiners and encouraged regulators to work with the industry to maintain fuel supplies in a state that often has the nation’s highest gasoline prices. The California Energy Commission has since walked back plans to impose a profit cap on refiners, a key factor in spurring recent plant closures.
By Stephen Golub, Benicia resident and author. September 2, 2025. [First published in the Benicia Herald on 8/31/25.]
Before the California State Legislature session ends on September 12, the legislators and other State officials may well make crucial decisions on bills and policies regarding the Valero Benicia Refinery’s future. Benicians have barely any time to weigh in on this matter so essential to our health, safety and future, particularly by contacting State Assemblywoman Lori Wilson. She represents Benicia and plays a significant role in this process.
While there’s still a chance that Valero might depart by its self-proclaimed April 2026 deadline, it seems at least as likely that the company and the State will extend its stay by at least a few years.
I’d favor pressing for Valero to stick to that 2026 date. My main concern is that a few years could turn into many, blocking us from biting the bullet to diversify our economy and realize potential benefits such as clean air and enhanced property values in a refinery-free community. A continued presence poses demonstrated risks, including polluting our politics as well as our air. Valero’s harmful operational and advocacy track record is a testament to those risks.
For at least 16 years, the Valero Benicia Refinery spewed toxic emissions hundreds of times the regulatory limits into the City’s air, spurring an $82 million Bay Area Air District fine.According to the Air District, from at least 2003 to 2019 the Benicia refinery committed “egregious emissions violations,” pouring into the city’s air “harmful organic compounds” containing “benzene, toluene, ethylbenzene and xylene…which cause cancer, reproductive harm and other toxic health effects.”
Valero knowingly committed these violations, yet did not inform governmental authorities. In the same statement just cited, the Air District explained that “refinery management had known since at least 2003 that emissions from the hydrogen system contained these harmful and toxic air contaminants but did not report them or take any steps to prevent them.”
These 16 years of violations and toxic emissions are but one example of Valero’s hazardous track record in Benicia and across America, including Arkansas, Louisiana, New Jersy, New York, Tennessee and Texas. Even the arguably oil industry-friendly Texas Attorney General sued Valero in 2019 for refinery violations there, in effect citing it as an egregious repeat offender.
Benicia’s cancer rates are far higher than those of the State and Solano County. For example, the city’s breast cancer rate is 93.7 percent higher than California’s and 35.9 percent higher than the County’s. The possible connection to the Benicia refinery is buttressed by research from around the country and world indicating elevated cancer, leukemia and asthma disease rates in refinery communities.
Valero’s contributions to climate change threaten Benicia. Above and beyond its facilities’ direct environmental impact, the Texas-based corporation has played a major role in the Western States Petroleum Association (WSPA), which has sought to stymie policies and legislation that would limit rising sea levels and other climate changes that challenge our town. Have you noticed the First Street Green parking lot’s winter flooding? Thank Valero and the WSPA if that kind of climate change damage increasingly bedevils Benicia in years to come.
Having said all this…
If the corporation and California nonetheless decide to extend the refinery’s stay despite these and other concerns, let’s press for ironclad Valero guarantees that it will: 1) close the refinery by 2029; 2) assure severance pay and other appropriate benefits for its workers, especially our Benicia-based friends and neighbors, who bear no responsibility for the Texas-based corporation’s track record; 3) abide by all legal and moral clean-up requirements for the property, rather than pursuing bankruptcy or other options to evade its responsibilities; and 4) not sell the property to another petrochemical industry operator, which might have as bad or worse an environmental record.
We should similarly seek State guarantees that it will 1) support Benicia’s existing Industrial Safety Ordinance; 2) not block any other local measures to protect or enhance our community’s well-being; 3) not undertake any joint venture with the firm, as that could undercut both our refinery oversight and refinery-linked revenues; and 4) not water down or overturn State, regional and local environmental regulations.
I emphasize Wilson because, as Chair of the Assembly’s Transportation Committee, she plays a central role regarding any Valero-related legislation and policies – which, again, may well be determined in the days to come.
We can also email Benicia’s City Council members, pressing them to lobby state officials on our behalf if they’re not already doing so.
Time is growing very short. Now’s the time to act.
A few more noteworthy Benicia notes:
First, property owners should please vote for the Parks, Landscape and Lighting Assessment District (PLLAD ) plan on the ballot recently mailed to you. Funds to provide for vital services for our parks and related facilities are inadequate, not having been updated since 1989. The PLLAD will help keep Beautiful Benicia moving forward, as well as enhancing our property values regardless of whether we use those facilities.
Big kudos for City Manager Mario Giuliani for the “Mondays with Mario” session he hosted at Lucca’s Bar and Grill on August 25. For the 20 or so folks present, it was an illuminating discussion of why we need PLAAD, what’s happening with Valero and several other topics. Councilmembers Trevor Macenski and Terry Scott, and former Councilmember Tom Campbell, also usefully chipped in to the discussion. The next Monday with Mario will be on September 15 at Roundtable Pizza, 878 Southampton Rd, at 6-7 pm.
Equally big kudos to the Benicia Police for all that they do, but particularly (as reported in the Herald) for the August 21 arrest near the Lake Herman Road reservoir of an escaped fugitive wanted for ten counts of arson in Washington State. I don’t want to rush to judgment: As far as I know, we don’t know whether he was associated with recent blazes near Benicia or other details of his background. But if in fact he’s guilty of such acts, it’s good to get him off the streets – especially our streets.
[Comment from BenIndy editor: We previously issued a call for Benicians to attend an August 20 hearing before a Joint California Assembly Committee in Sacramento to consider the legislation known as the “Petroleum Market Stabilization” bill. Several Benicia residents attended, including Dirk Fulton, who offers the following reflections. – RS]
The legislature is clearly following the recommendations of the California Energy Commission (CEC) at Gov. Newsom’s request. CEC Vice-Chair Gunda made a lengthy presentation and answered followup questions from legislators. Late in the hearing, an Assemblyman from Los Angeles asked if the State was considering “taking over” the refinery. Gunda responded saying that Valero is in private talks with the CEC and all options are being explored to keep Valero open. One option could of course include a joint venture structure between Valero & the State. Oil companies do this all the time.
This alternative would be a horrible result for Benicia from both a regulatory and refinery closure standpoint.
Another Assemblyman commented that if exports of California refined product to Nevada and Arizona were reduced, there would be a 10% surplus in capacity of refined product thereby eliminating the prospect of any California gas shortages following a Valero closure. There was also discussion of increasing imports which is doable, and subsidizing further EV usage thereby reducing demand for gasoline, which would allow Valero to close without causing gasoline prices to spike.
Importantly, a longtime energy consultant to Citizens for a Better Environment and now a consultant to the CEC released a study yesterday morning demonstrating that as the PBF Martinez refinery returns to production (closed since the February fire), its production will offset any loss of production from a Valero closure.
A lobbyist from the Western States Petroleum Association (WSPA) was allowed to present for twenty minutes and respond to questions for another twenty. He stated that he meets regularly with the CEC to advocate for Valero remaining open. He seemed to have strong influence over the CEC and legislators including Benicia’s representative Lori Wilson.
Mayor Young’s 10 minutes of testimony did not help us regarding getting Valero closed. He basically wants the refinery to remain open for at least five more years-which basically means forever. He did NOT address our high cancer or asthma rates or address ongoing health risks to residents.
My takeaways:
Refining capacity is manageable. It can be maintained at acceptable limits following a Valero closure so gas prices don’t spike.
A State/Valero venture would be horrible for Benicia as increased regulation would be difficult and the refinery likely would never close. This seems to be a WSPA idea and comes from the Donald Trump playbook , e.g., what Trump has our federal government doing with Intel – a joint-venture-like concept where USA is contributing capital to sustain Intel Corp and receiving equity and profits in return.
Our best strategy to discourage the State and Valero going forward and to discourage any potential buyer is the local Polluters Pay Excise tax ballot measure. A $1 per barrel tax would substantially diminish refinery profit thereby operating as a disincentive. The Richmond example shows it works. Mayor Young told me in a hallway conversation that he supports the idea, and has received advice from City Attorney Ben Stock this week that it is legal.
We need a local citizens committee to be formed to lobby for this proposal.
Dirk Fulton, Lifelong Resident & former Solano County Planning Commissioner, Vice Mayor, City Councilman & School Board President
For More Information visit: www.greatdayforbenicia.com
AS THE CITY & STATE WORK TO KEEP VALERO OPEN, A LOCAL REFINERY “POLLUTERS PAY” EXCISE TAX IS REQUIRED TO PROTECT US
By Dirk Fulton, August 17, 2025
URGENT: STATE ACTION & LEGISLATIVE HEARING THIS WEDNESDAY, AUGUST 20
We know Governor Newsom, the California Energy Commission (CEC) and the legislature are seeking to keep the Valero Benicia refinery open. Our city leaders have been complicit with the State in this effort. In fact, the CEC is acting as a broker to find a replacement operator and the Governor is sponsoring legislation to cut refinery regulations as an enticement to attract a successor.
A hearing is set for 1:30 PM this Wednesday (8/20) before a Joint State Assembly Committee in Sacramento to consider the legislation, known as the ‘Petroleum Market Stabilization” bill. Benicia residents are encouraged to attend the hearing and express their opposition. A sign-up form is here. Further info and talking points will be provided once you’ve signed up. And please reach out to action@sunflower-alliance.org if you can give a ride on Wednesday or want to join some others on the train.
OUR HIGH CANCER RATES REQUIRE CITY ACTION
Benicia residents Dr. Richard Fleming and columnist Steve Golub have separately published articles documenting that Benicia’s rates of cancer are much higher than Solano County and the State of California. The rates are astonishing:
Our breast cancer rate is 94% higher than the California rate.
Our prostate cancer rate is 70% higher than the State’s.
Our rate of lung cancer is 44% higher than the State rate.
Valero’s emissions routinely exceed Air Board limits and over a 16-year period ending last November, the emissions exceeded Air Board limits by 360%, often constituting 2.7 metric tons of hazardous pollution daily. Extensive medical studies have found a well-documented connection between residents living in refinery communities and higher cancer rates.
A “POLLUTERS PAY” EXCISE TAX CAN BE USED TO PROTECT US
Unless citizens’ efforts in opposition to the Governor’s bill are successful on Wednesday, it appears likely that the State will cause the Valero refinery to remain open indefinitely, perhaps through a new operator.
The Benicia City Council, accordingly, should immediately take action to place a refinery $1-per-barrel excise tax (“Polluters Pay Tax”) on the ballot. Only a simple majority vote is needed for passage. The tax would apply to all feedstock refined at Valero’s two refineries, including product refined elsewhere and placed in storage tanks at the refinery, and would generate $50-$70 million per year for a 50-year period. The tax proceeds can support pollution-fighting services like real-time extensive air monitoring, air filters for schools, advanced health and safety monitoring for neighborhoods, and environmental oversight and cleanup. Importantly, the tax can be crafted as an excise tax—targeted specifically at local refining, not a broad manufacturing or consumer tax.
In mid-2024, the Richmond City Council unanimously approved placing a refinery excise tax ballot measure on the ballot targeted at the Chevron refinery. Chevron opposed the proposal which led to a settlement on June 18,2024 as follows: Chevron agreed to pay the city of Richmond $550 million structured as $50 million annually the first five years, and $60 million for the next five years in exchange for the city removing the tax proposal from the ballot.
Our Benicia City Council has a duty to protect us from refinery pollution and should move forward expeditiously to place a similar $1-per-barrel excise tax on the ballot. Should the City Council once again fail to act, residents can circulate Initiative petitions, gather signatures and cause the tax to be placed on the ballot in June 2026. Hopefully, our city leaders will do the right thing and the Initiative process will not be necessary.
Dirk Fulton, Lifelong Resident & former Solano County Planning Commissioner, Vice Mayor, City Councilman & School Board President
For More Information visit: www.greatdayforbenicia.com
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