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    LB Results On LNG: Port Keeps Power, Selectively Mute Mayor Leaves Council Message Mooted

    (June 23, 2005) -- As first reported on June 22 by as breaking news and as an accompanying advisory on our front page, the U.S. Senate declined to adopt (tabled) an amendment by U.S. Senator Dianne Feinstein (D., CA) to amend an advancing federal Energy bill offered by Sen. Dianne Feinstein that would have allowed Governors to veto decisions of the Fed'l Energy Regulatory Comm'n re the siting of Liquefied Natural Gas (LNG) facilities. The vote to table was 52-45.

    The end result leaves the Port of LB, currently governed by a non-elected, non-recallable Board of Harbor Commissioners, with the power (LB's City Attorney says) as landlord to approve or disapprove using Port land for an 80+ million gallon Liquefied Natural Gas (LNG) facility roughly two miles from downtown LB...while leaving LB's elected City Council with no guarantee (LB's City Attorney says) that it will retain its current ability to review on appeal the adequacy of Environmental Impact documents on the project.

    Lawyers for the Mitsubishi subsidiary seeking to build and operate the LNG plant dispute the City Attorney's view of the legislation, insisting it doesn't change current Port/Council Environmental Review authority; the project applicant adds that regardless of the federal Energy bill, it intends to comply with the current Port-Council EIR process.

    The Senate vote comes after the House of Representatives on April 22 also defeated amendments that sought to preserve local authority over LNG facilities.

    Senator Feinstein and others supporting the amendment were unable to say about LB what they could say about other potentially impacted communities. Unlike LB, Mayors and City Councils in a number of other cities facing pending LNG projects oppose putting them near their densely populated areas or other potential targets.

    Senator Feinstein publicly supported this position in a February 2005 a Senate Energy Committee hearing (previously reported by reiterated it on the Senate floor on June 22:

    In this post-9/11 world, I think we have to look a little differently at the siting of all facilities, and especially the specific risk that LNG terminals pose. A December 2004 report by Sandia National Laboratories concluded that LNG tankers could, in fact, be a potential terrorist target. If the worst case scenario were to occur, a tanker could in fact spill liquefied natural gas that, in about 30 seconds, could set off a fire that would cause second-degree burns on people nearly a mile away...

    ...If there are other options besides putting these facilities in busy ports or near population centers, they should be sited where they pose the least danger to people, not just where they make the most economic sense.

    In presenting her amendment, Senator Feinstein said:

    Under the pending Energy bill, the Governor would have no veto authority for siting onshore LNG terminals. In other words, if the Governor of California or Massachusetts or anywhere else were to decide an LNG terminal posed too great a safety risk to the 400,000 people living close -- let's say to the Port of Long Beach; that is the only proposed onshore project in California -- then the Governor would have no authority, the State would have no authority to veto that project. But if that same project were located offshore, more than 3 miles away from the Port of Long Beach, the Governor would be able [under federal law] to veto it. That [inconsistency] is nonsensical, in my view.

    The now-advancing federal Energy bill effectively stems from actions by the Port of LB, which entered into a Memorandum of Understanding (MOU) with a Mitsubishi facility for exclusive negotiating rights to the Port site without safety studies, without consulting publicly with the City Council or seeking its approval..and has since facilitated the firm's application with the Federal Energy Regulatory Commission (FERC) without requiring that the firm seek permission under CA law from CA's Public Utilities Commission (CPUC).

    FERC then used the PoLB site to assert that FERC has exclusive LNG authority nationwide under federal law...and said CPUC has no authority on siting and safety decisionmaking on LNG facilities.

    CPUC sued FERC in federal court to uphold CA law, but neither LB City Hall nor the Port of LB intervened to support CPUC's position. However, local writer and LB LNG project opponent Bry Myown with LB Citizens for Utility Reform and others did.

    To trump the litigation, FERC asked Congress for legislative language that would unambiguously establish FERC's LNG supremacy nationwide...which is the origin of the Energy bill language that passed the House of Representatives in April and is likely to pass the Senate now.

    LB's Board of Harbor Commissioners will (says the City Attorney) retain its inherent power of landlord over the PoLB site. Other state and local agency permits are not affected...but absent some last ditch maneuver in a House-Senate Conference Committee or a Senate filibuster (neither considered likely), the PoLB-spawned federal Energy legislation will effectively strip the CA Public Utilities Commission and similar state regulatory bodies across the country of decisionmaking authority on LNG facility siting and safety.

    "LB activists must have had some people worried," quipped Ms. Myown. "It took an act of Congress to try and stop us." She added, "Developments nationally have escalated the LNG issue locally. It won't go away and it will grow."

    That tension surfaced at the June 21 meeting of meeting in which LB lawmakers voted 8-0 (Uranga absent) to confirm Mayor O'Neill's latest choice for LB's Harbor Commission, an appointee who will be unable to vote on the proposed LNG project until June 2006 because (as first reported by of his ownership until last week of stock in ConocoPhillips, which is partnering in a development agreement for the PoLB LNG facility. The Mayor did not disclose the conflict in advancing the nomination, even though it was properly disclosed by the nominee himself on a form filed with the City Clerk...and then reported by At the Council meeting considering the nomination, Mayor O'Neill used a point of order asserted by Councilwoman Richardson to try and derail Ms. Myown's hardball criticism of the nomination process, then relented. Detailed coverage, click here

    In June 2003, as first reported locally by, Mayor O'Neill quietly wrote Sen. Feinstein, seeking her assistance in having federal authorities speed the LB LNG project to conclusion. When some LB Councilmembers learned of this (LB activist Bry Myown uncovered the letter via a Public Records Request) and objected to the Mayor's assertion of city policy, Mayor O'Neill acknowledged that she should have waited for Council policy direction...but didn't back away from her apparent personal support for the project reflected in her letter.

    While the federal Energy legislation began taking shape in late 2004 and advanced through Congress in early 2005, Mayor O'Neill did not use her position in the U.S. Conference of Mayors (VP for past year, President now) to oppose the federal LNG preemptive language, even though the issue potentially affects Mayors in coastal communities across the country. As first reported by, the chair of the Conference of Mayor's Energy Committee said Mayor O'Neill hadn't spoken to him about LNG concerns. As a result, the National Conference of Mayors' Energy committee advanced a series of policy resolutions that never mentioned the subject.

    On March 22, Mayor O'Neill did write to the chair of the Senate (not House) Energy & Natural Resources Committee to oppose giving FERC eminent domain authority (eminent domain was strongly opposed by the Port and the Council backed the Port on this) and opposed giving FERC exclusive siting and permitting authority. Meanwhile, the House version of the Energy bill was advancing toward an April Committee hearing and House vote.

    On April 19, acting at the urging of Councilman Frank Colonna, the LB City Council voted to urge LB officials to use all available avenues to oppose the locally preemptive LNG portions of the advancing federal Energy bill. However, Mayor O'Neill did not move to amend the Conference of Mayors' policy resolutions -- adopted in June as the U.S. Senate began consideration of the Energy bill -- to reflect LB's stated position.

    Mayor O'Neill did, however, support policy resolutions that put the Conference of Mayors group on record in favor of major taxpayer-funded infrastructure and goods movement projects sought by the Port and City of LB.

    As previously reported by, the Conference of Mayors' advocacy on LNG to date appears to consist of a one page letter dated April 20, co-signed by the group's Executive Director along with Exec Dirs. of the National League of Cities and Nat'l Ass'n of Counties (on the eve of House passage of the Energy bill) opposing federal preemption. As of last week, the subject of local authority on LNG didn't appear on the Conf. of Mayor's web site or via its search engine.

    On April 21, Mayor O'Neill sent a letter to House members opposing federal LNG preemption...on the same day that the House was scheduled to vote on the matter.

    Responding to fast breaking events before leaving on a previously scheduled legislative advocacy trip to Washington, D.C., Councilman Colonna convened a special meeting of the Federal Legislation and Environmental Affairs Committee (Colonna, chair; Kell, vice chair; Reyes Uranga member) on April 22 to receive a report from LBPD and LBFD on a visit to a Boston harbor area LNG site. LBPD and LBFD officials described local costs being incurred by Boston area officials and also discussed safety concerns locally. coverage, click here

    On May 24, as previously reported by, Mayor O'Neill sent a letter to Senator Feinstein opposing federal preemption on LNG. Senator Feinstein quoted Mayor O'Neill's letter in a press release previewing her proposed amendment.

    Just over two weeks earlier on June 7, by a 5-4 vote Councilmembers O'Donnell, Kell, Richardson, Uranga and Lerch blocked a motion supported by Councilmembers Lowenthal, Baker, Colonna, Gabelich to terminate a Memorandum of Understanding, a companion to a possible future Port agreement of the LNG project.

    The June 7 vote took place after Mayor O'Neill sought to delay the item until June 21. IT was agendized by, and then withdrawn by, the City Manager and City Attorney after Councilwoman Reyes Uranga, the only LB Councilmember who has publicly voiced support for the LNG project, objected to consideration of the item on May 24.

    Councilmembers Colonna, Lowenthal and Gabelich then forced a more prompt showdown, reagendizing the item for June 7. The delay, sought by Councilwoman Uranga and enabled by the Mayor, allowed members of a union that stands to receive jobs from building the LNG plant to pack the Council chamber in support of the LNG project two weeks later.

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