RICHMOND — A tax ballot measure that could have forced Chevron to pay tens of millions more annually to Richmond’s general fund has been shelved as part of a $550 million settlement agreement, a decision met with disappointment from measure proponents and support from city and Chevron employees.
“The community of Richmond has created a movement that will echo across the nation,” Mayor Eduardo Martinez said during Wednesday’s special meeting. “This is just the beginning.”
Councilmembers met twice this week, in closed session Tuesday and open session Wednesday, to discuss the future of the ballot measure. They ultimately decided to take legal counsel’s advice, pulling the measure from the Nov. 5 ballot and accepting the $550 million payment from Chevron.
Payments will be made over the next 10 years, according to a deal negotiated by an ad hoc committee of Martinez, Vice Mayor Claudia Jimenez and Councilmember Doria Robinson.
The decision reverses an initial vote in June to place a refinery tax measure, dubbed the Polluters Pay Initiative by activist groups, on the November ballot. Had the measure been approved by a simple majority of Richmond voters, it would have brought in an estimated $60 million to $90 million annually in taxes, based on how many barrels of raw material enter the Richmond plant for processing.
Proponents of the measure, the Polluters Pay Coalition, have argued the tax would force Chevron to pay its fair share in taxes and compensate residents who according to state data experience some of the highest rates of asthma in the state. The dollars would have also helped fund a clean-up plan in the event the refinery ever ceases operations.
“Richmond voters deserve the opportunity to vote on this simple and transformative measure, the Polluters Pay Measure, that would have held Richmond’s largest polluter accountable for over a century of health and climate damages,” Connie Cho, a senior policy advisor with Asian Pacific Environmental Network Action, said Wednesday. “What’s unfortunate is that the council folded at the first whiff of litigation.”
Kerry Guerin, an attorney with Communities for a Better Environment, has also said supporters would not have put the refinery tax measure forward if they didn’t believe it would stand a legal challenge. She asked that the council reject the settlement agreement Wednesday to allow the voters to decide.
“Our campaign did not approach the city with this concept just so that Chevron would cut a deal that would be pennies to them. I did not write this ballot measure and tax ordinance just for the city could settle,” Guerin said.
But on Monday, Contra Costa County Superior Court Judge John P. Devine agreed in part with arguments raised by the recently formed nonprofit Coalition for Richmond’s Future and Chevron employee Daniela Dickey asserting the ballot language was misleading because it said tax dollars would fund various city projects without noting a vast majority of the general fund covers staff salaries and benefits.
The ruling would have forced the city to rewrite a portion of the ballot measure before it could be put before voters.
Cho noted the legal challenge was not to the validity of the tax measure. The Polluters Pay Coalition, made up by Communities for a Better Environment and Asian Pacific Environmental Network Action, also asserted the measure had strong community support and Chevron offered to pay half a billion dollars to the city “rather than lose at the ballot box.”
“For generations, Chevron has raked in billions in profits while spreading sickness and death in Richmond communities. Chevron has not only polluted the air, but also our politics,” Megan Zapanta, Richmond organizing director with APEN Action and the Polluters Pay Coalition, said in a statement Wednesday. “We are disappointed that Richmond voters didn’t get the opportunity to vote on a measure that would have held Richmond’s largest polluter accountable for over a century of health and climate damages for the next 50 years, not just the next 10.”
Meanwhile, members of a variety of city unions that once backed the tax initiative and Chevron employees came out to both council meetings to praise officials for striking what they say is a fair compromise.
“The health issues that pollution causes in Richmond hurt us all, whether we live in Richmond or work in Richmond or, like so many of our members, both. The way that this city’s workforce and residents have had to do without has been shameful, and that’s why it’s so important that we were able to avoid lengthy litigation and achieve this settlement,” said SEIU Local 1021 President Greg Everetts in a statement. “Together, we are paving the way for a cleaner, healthier and fairer future for everybody who lives and works in Richmond.”
The agreement calls for Chevron to pay $50 million annually to the general fund for the first five years, followed by $60 million annually the last five. The city would retain its right to impose new taxes on Chevron and other businesses, but the settlement payments would be credited toward what the refinery would owe. Chevron would also be required to continue paying the agreement even if the site near Point Richmond is sold to a third party.
The city’s legal team recommended the council adopt the settlement, noting the city would likely face years of expensive litigation if they moved forward with the ballot measure. An outside attorney hired by the city pointed to a years-long legal battle in the Los Angeles County city of Carson, where a refinery tax was adopted in 2017.
Councilmembers agreed, voting unanimously to approve the resolution, accepting the settlement and killing the tax measure ahead of the Wednesday election filing deadline. They also signaled support for requests made by the Polluters Pay Coalition to form a community oversight committee who will monitor the spending of the new dollars and to using some of the money to form a just transition plan for the future of the site.
“We need to put this money to work now. We need to start moving toward just transition now. There’s so much to be done,” said Councilmember Robinson, who noted that she grew up in the shadows of the refinery.