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    City Att'y Again Stresses His View Of Preemptive Effects Of Advancing Fed'l LNG Legislation, Tells Council "At Some Future Point You May Not Necessarily Be Able To Weigh In As A Decisionmaker On The [proposed LNG facility] EIR On Appeal"

    (June 8, 2005) -- During the June 7th City Council discussion of an LNG facility proposed in the Port of LB, LB City Attorney Bob Shannon publicly reiterated his office's position regarding preemptive effects of advancing federal LNG legislation.

    "I don't want you to leave this room believing that at some future point in time you will necessarily be able to weigh in as a decisionmaker on the [proposed LNG facility] EIR on appeal, because that may not be the case, because the federal government may very well preempt that particular process," City Attorney Shannon told Councilmembers.

    We post Mr. Shannon's entire statement verbatim below.

    City Attorney Shannon: I just want to briefly comment on the statements made [earlier in the Council meeting, posted below] by two attorneys, Ms. Richardson and Mr. Ehrlich. We had a long conversation about the issue of federal preemption.

    And I do realize that good legal minds can differ, but with all due respect, our office differs with their interpretation of what the federal government is attempting to do here.

    It's our position -- we don't know what the final federal legislation is going to look like, there may be no final federal legislation although it appears the President is pushing very hard to have some legislation -- but I think there's a very distinct possibility that there will be a significant federal preemptive effect on any state law.

    And let me just start by reading to you what is currently in the Senate bill that's proposed. And again, this could change at any time but this what they're trying to do:

    The Commission -- that is, the FERC -- the FERC shall have the exclusive authority to approve or deny an application for the siting, construction, expansion or operation of facilities located onshore or in state waters for the import of natural gas from a foreign country.

    That tells me in very plain language that, at least some folks in the Congress, are attempting to give the FERC "exclusive jurisdiction." That would suggest to me that this has a preemptive effect on any state mechanisms, the most significant of which would be CEQA [CA Environmental Quality Act, governs EIRs].

    So, will it end up that way, and is it really intended to be that way? Of course reasonable minds can differ.

    But I don't want you to leave this room believing that at some future point in time you will necessarily be able to weigh in as a decisionmaker on the EIR on appeal, because that may not be the case, because the federal government may very well preempt that particular process.

    Now this is not just our opinion. We have on retainer a law firm in Washington, a very experienced law firm, that takes a very, very dim view of what's going on in the Congress, and believes that there is a very, very significant federal preemptive effect that's going to take place if in fact this legislation or something very much like it passes.

    Mr. Shannon's statement responded to public remarks made earlier in the proceedings by two attorneys for Sound Energy Solutions (Washington, D.C. counsel Julie Richardson and L.A. outside counsel Ken Ehrlich (Jeffer, Mangels, Butler & Marmaro)). We post portions of their statements regarding federal preemption below:

    Mr. Ehrlich: ...There's been talk about whether the federal legislation, if passed in any form, can somehow preempt California's CEQA process. The Port is the lead CEQA agency. This Council will hold the rights on appeal to sustain the adequacy of that EIR under CEQA.

    There is nothing in the federal legislation that would change that...

    Ms. Richardson: ...Nothing in the federal legislation affects the rights or responsibilities of the Port of Long Beach. Nothing. You are not preempted. You are able to go ahead and finish whatever your procedures are under state law, and the reason that you can do that is because the Port of Long Beach owns this property. There is no right of federal eminent domain, there is no proposal even in either bill, for federal right of eminent domain.

    Therefore you can go right ahead and finish this process, look at all the issues that have been raised tonight by all your concerned citizens, give them the opportunity to comment on a fully completed EIR and make that a part and parcel of the consideration as to whether or not to enter into this lease.

    Now, if I'm wrong -- and I think reasonable people could have a difference of opinion on this -- if I am wrong that federal preemption does attach, it doesn't matter.

    And the reason it doesn't matter is because you heard the company tonight. They are going to apply for and obtain every single state, local and regional permit whether they're preempted or not.

    Therefore this is not an issue, and I don't think we should distract ourselves by questioning whether or not there will be preemption. This is a matter of local control and it will stay so...

    As previously reported by, Mr. Ehrlich sent City Attorney a letter on June 3 stating the company's perspective on the 2003 Memorandum of Understanding between LB Energy and SES and the status of federal legislation regarding the permitting process for LNG terminals nationally. It can be viewed in pdf form at June 3 letter from SES outside counsel Ehrlich to City Attorney Shannon.

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