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    Colonna, Gabelich & Lowenthal Move To Seek June 7 Showdown Vote re LB LNG

    (May 27, 2005) -- In a dramatic development spurred by advancing legislation to give the Federal Energy Regulatory Commission (FERC) powers overriding local control on significant aspects of Liquefied Natural Gas (LNG) facilities, LB Councilmembers Frank Colonna, Rae Gabelich and Bonnie Lowenthal are calling for a June 7th City Council vote to end a 2003 Memorandum of Understanding (MOU) with an applicant seeking to build and operate an 80+ million gallon Liquefied Natural Gas (LNG) facility in the Port of LB, roughly two miles from downtown LB.

    The Council action would formally end City Hall negotiations (via LB Energy) with the LB LNG applicant for a possible future pipeline and a long-term gas supply. City Hall's MOU is cited in a separate Port of LB MOU with the project applicant which states in pertinent part:

    "Concurrent with any final agreement with the Port of Long Beach, SES will enter into an arrangement for the benefit of the citizens of Long Beach, the Long Beach Energy Department, and the Port of Long Beach to provide liquid natural gas (natural gas.)"

    On May 24, LB City Manager Jerry Miller and City Attorney Bob Shannon jointly agendized an item seeking Council direction on how to proceed under the City Hall MOU, stating that the Port MOU verbiage means:

    "[N]o final agreement with the Port will occur under the Port’s existing MOU unless SES successfully concludes negotiations on the two issues discussed in Long Beach Energy’s MOU approved by the City Council."

    In their joint agendizing memo for the June 7 Council meeting, Councilmembers Colonna, Gabelich and Lowenthal state:

    The City Council has established a Memorandum of Understanding with Sound Energy Solutions to explore the possibility of maintaining gas pipelines for the proposed LNG facility.

    Recently, the LNG facility proposal has gained significant national and local attention. In particular, much of the community is concerned with the safety of an LNG facility and the associated potential dangers.

    To maintain a high level of transparency by our City Council, and to provide the leadership and policy direction expected of the Council, the discussion and action on this item should take place promptly, and not delayed until the June 21 meeting.

    It is vital that the City Council give policy direction to our City Manager and City Attorney as soon as possible. Communicating our position as a city is an important step in light of the local and national debate taking place on LNG facilities.

    Recommended Council Action

    Recommendation to authorize City Manager to formally terminate negotiations with Sound Energy Solutions (SES/Mitsubishi) regarding a long-term natural gas supply and the feasibility of constructing and operating interconnecting gas pipelines to the proposed liquefied natural gas (LNG) facility, per the Memorandum of Understanding approved by City Council on May 13, 2003.

    A statement released May 26th by Councilman Colonna amplifies on the agendized action:

    Delaying the discussion of a Liquefied Natural Gas facility and whether to continue with a proposed Memorandum of Understanding regarding the use of a city pipeline is not helping to maintain a committed level of transparency by our City Council. The issue of proper notification to postpone the matter to June 21, 2005 is delaying the matter beyond a credible level.

    As a result, I have teamed up with Councilmembers Gabelich and Lowenthal to move up the LNG debate to the June 7, 2005 City Council meeting. If beginning the work of the City Council on June 7 two hours earlier is necessary, I am fully committed and prepared to be present at whatever time is deemed necessary to accomplish our workload.

    The Miller-Shannon May 24 agenda item was abruptly withdrawn after 7th district Councilwoman Tonia Reyes Uranga -- outside of the public Council meeting -- opposed proceeding with the item. Audience members (from visible indications mainly opposed to the LNG project) were incensed when LB Mayor Beverly O'Neill announced ninety minutes into the Council meeting that the item would not be heard (effectively preventing their testimony) and would be delayed until June 21. The item escalated over the next twenty-four hours as fiery emails flew from activists and the public to City Hall, decrying the action.

    Meanwhile, Councilwoman Reyes Uranga -- whose non-public objections precipitated the May 24 action and resulting uproar -- has sent a memo seeking to agendize what she calls "an open and transparent" discussion on the appropriateness of locating an LNG facility in LB "not obscured behind terminating negotiations for a 'preferential assignment agreement' or advocacy on perceived legislation." Her item proposes adopting a City Council position regarding the development of a proposed LNG facility in the Port of LB.

    Asked by after the May 24 Council session why she didn't make a motion in public, requiring her to win a Council vote to delay the item after the public spoke, Councilwoman Reyes Uranga blamed the City Manager and City Attorney for removing the agenda item...[which followed her non-public objections to proceeding with the item].

    Councilwoman Reyes Uranga also told that she believed LB's non-elected (Mayor-chosen, Council-approved) Harbor Commissioners should have been present.

    Under LB's current City Charter, the Harbor Commission, not the City Council, is governing body with the leasing authority (and thus the ultimate local power) to say "yes" or "no" to allowing the LNG facility on Port property (Pier T, near the eastern part end of the Port).

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