Posted on August 18, 2008

Council members helped craft Chevron agreement

By Katherine Tam
West County Times

Several Richmond council members were heavily involved in negotiating a deal for Chevron Corp. to give the city $61.6 million for police, job training and other programs — a deal that the council approved July 17 along with the oil giant's highly contentious plan to modify its refinery.

They talked to Chevron about what programs ought to be funded in a "community benefits agreement" and how much money would be appropriated.

Council members John Marquez and Maria Viramontes received a copy of the nearly completed agreement two days before the full council and the public got a glimpse, according to records obtained by the Times.

Accusations have circulated widely about the deal's genesis after a council majority approved the agreement — and Chevron's project, which had been the subject of months of heated public debate.

Supporters embraced the deal as critical revenue for the city, while opponents — who claim Chevron's refinery project will increase pollution — lambasted it as a "sellout."

Chevron wasn't required to fund city programs as part of its application to replace decades-old equipment, Viramontes said, and making such an agreement a provision of the permit would have opened the city up to a possible lawsuit. So officials asked the company to give money voluntarily, a request they said had to be carefully negotiated.

"It's hard to have a conversation about a community benefits agreement when legally you cannot demand it of them," Viramontes said. "It was challenging for council members to even have a meeting to talk about it with Chevron."

Councilman Tom Butt, Mayor Gayle McLaughlin and some residents believe a majority of the council crafted an agreement without the rest of the council or the public until the council began its two-day decision-making hearing on Chevron's project July 15. That day, Chevron presented a signed nine-year agreement to the city.

"Richmond has been taken to the cleaners by this secret deal which sacrifices our health, environmental justice and democratic processes for a few paltry million dollars," Butt and McLaughlin wrote in a joint statement.

A meeting of five council members constitutes a quorum and violates California's open meetings law if public notice is not given.

Marquez, Viramontes and council members Nat Bates, Ludmyrna Lopez and Jim Rogers, who all voted yes on the agreement, said they never held such a meeting. Harpreet Sandhu, the sixth council member who approved the agreement, could not be reached for comment.

A Times review of city records, including council members' e-mails, obtained through a public records request, did not find documentation showing a council majority met together to develop the Chevron agreement. Under the request, council members were to provide documents on this issue including e-mails from private accounts.

But records clearly show a few council members played substantially larger roles than others in the negotiations. Chevron consultant Tom Powers e-mailed Viramontes and Marquez copies of the nearly completed agreement July 13, two days before the council's hearing.

Other council members, including some who voted for it, said they did not see the agreement until the day of the hearing. Lopez said she saw a draft in the weeks preceding the hearing but could not remember if it came from Chevron or the city.

Chevron sent a copy of the nearly finalized agreement to Marquez and Viramontes because those were the two with whom the company had the most conversations, said refinery spokesman Dean O'Hair. Chevron wanted to see if the two were on board, as a gauge for whether the full council might accept it, he said.

The idea of striking a community benefits agreement took root more than a year ago while Chevron's project was under review. Officials wanted Chevron to invest more in Richmond to help lower its homicide, unemployment and poverty rates.

City Manager Bill Lindsay and his staff met with Chevron multiple times. By late 2007, crime reduction, job training, solar energy projects and other programs were listed for funding, according to the documents reviewed by the Times. Dollar figures surfaced earlier this year, coming in at $40 million in March and $49.4 million in late June, records show.

The depth of individual council member discussions with Chevron varied. For example, Bates said he talked to Chevron about funding for police, health care, environmental benefits and community groups.

"The city manager can negotiate, but we (council members) had a different formula and approach of where we wanted to go," Bates said. "When you come in for permission for a permit, it's not contingent upon how much money you give to the city. We wanted to squeeze out as much as we could. I think citizens are going to recognize that agreement was a good agreement."

Others, including Rogers, McLaughlin and Councilman Tony Thurmond, played smaller roles, either having limited conversations or none at all.

McLaughlin, who did not speak to Chevron, objects to the deal and said the city should require that Chevron invest in the community through fees. Discussion of such a community benefits agreement should have come up only if Chevron's project were approved, and a committee of residents should have given input, she added.

"It totally locked out the public process. The whole process was done in a backward way," McLaughlin said.

Chevron had conversations with council members one-on-one or in pairs; the most would have been three council members, O'Hair recalled. These included sit-down discussions and less-formal conversations, and the dollar amounts in the final agreement came from the input Chevron received, he said.

A city draft circulated in early July. Lindsay e-mailed Butt the city's draft July 2 and Viramontes on July 3. The deal totaled $49.4 million then and was structured differently. Bates, McLaughlin, Rogers and Thurmond said they did not see the city draft.

At one point, county health officials and Supervisor John Gioia weighed in, offering guidelines to the city for a Chevron-funded health program that would serve Richmond's poor.

Reach Katherine Tam at 510-262-2787 or ktam@bayareanewsgroup.com.