Posts Tagged ‘24 billion’

Yes: A Safe $1.8B Drilling Deal, Blessed by Enviros

Tuesday, June 30th, 2009

sheehyBy Tom Sheehy
Special to Calbuzz

Since going on-line this year, Calbuzz has treated its readers  to timely reporting on the twists and turns of the Tranquillon Ridge project.  As the Legislature continues to debate the components of a budget plan to close a gap of more than $24 billion, we believe there’s still an opportunity to move forward on this project in a fiscally – and environmentally – responsible manner.

To re-cap: the product of an unprecedented agreement between an oil company (Plains Exploration and Production, or PXP) and a coalition of environmental groups, the project would allow PXP to access oil on state lands from an existing platform in nearby federal waters.  In return, the firm will give the state an immediate up-front $100 million royalty advance and about $1.8 billion over the next 14 years.  But it’s not just about the money:  once the project ends, the company will give 3,900 acres of central coast property it owns for permanent conservation and public use.  It also will stop production on four of its offshore rigs and take out all of its onshore production facilities.

Despite strong support for this project, the State Lands Commission didn’t allow the project it to move forward early in the year.  But in May, Gov. Schwarzenegger proposed an innovative approach to giving the project another opportunity for review.  The Governor has asked the Legislature to approve a bill restoring authority to the State Director of Finance for a limited window off time to reconsider certain offshore oil lease applications and determine if they’re in the best interest of the state.

The Governor maintains his strong opposition to new oil drilling off California’s coast and he continues to support the moratorium.  This project maintains the moratorium on oil drilling under the California Coastal Sanctuary Act of 1994 because it would operate from an existing oil platform in federal waters. It takes advantage of a specific exemption that allows for new leases if oil is leaking from an existing state field into an actively producing federal field — which is what’s happening in this case.  A State Lands Commission report determined that the ongoing drainage is reducing the ultimate amount of oil reserves that the state could recover by as much as 260,000 barrels a month.  That is $4 million per month in lost revenue to the state.

Or, think of it this way:  at a time when we’re being forced to pare back spending in education, health care, and virtually every area of state government, we’re essentially giving $4 million a month to the federal government.

The entire infrastructure needed to conduct this project is in place and already operating.  There will be no new platforms needed for the state to realize the project’s benefits.  Approval of the project will allow the state to capture the oil in an efficient manner while securing significant revenue.

Most importantly, this proposal doesn’t “subvert the public process” as some critics have alleged.  The Governor’s proposal builds upon five years of rigorous state and local government public environmental review by the Lands Commission and Santa Barbara County, as well as a meticulous California Environmental Quality Act (CEQA) review. If approved, the California Department of Finance would only have the authority to reconsider the project after additional public hearings. If Finance decides to move ahead, the project would still have to go through the California Coastal Commission’s public review process and also gain approval from the federal Minerals Management Service (MMS).

We are also confident that when the project ends, the state is strongly empowered to enforce the shutdown of oil operations.  PXP made a firm commitment and negotiated a binding agreement with a coalition of environmental organizations to take out its platforms, remove its onshore facilities, and provide a valuable package of environmental benefits.  There also are multi-layered enforcement tools in place:  permits for this project will be enforceable by the State Lands Commission leases and the County and Coastal Commission permits.  In addition, the terms of the agreement between PXP and the environmental coalition uniquely allow the California Attorney General the right to intervene in court to enforce the agreement.

These are difficult, challenging, and unprecedented times in California.  We believe the Tranquillon Ridge Project is a common-sense, environmentally responsible approach to leveraging the state’s own resources to help generate vital new revenues at a time of great fiscal need.

How to Save Millions On Elections

Thursday, June 11th, 2009

gautam-dutta2tedlieu1Let’s be blunt: Calbuzz has an abiding self-interest in elections – the more elections, the greater the pressing need for blindingly insightful political analysis, gossip, speculation and cheap shots. Even we, however, have a hard time defending the exorbitant costs of  the constant round of special elections triggered by musical chairs politics of California. With our interest in all manner of political reform, Calbuzz today offered space to the New America Foundation to discuss a modest proposal for electoral reform that  could save millions.

By Gautum Dutta and Ted Lieu
Special to Calbuzz

California faces a crater-size, $24 billion deficit – and we’re about to throw away millions more on three elections we don’t need. But here’s the good news: If we adopt Instant Runoff Voting, or IRV, for special elections, we can save that amount and more.

With IRV, taxpayers could save nearly $2 million July 14 (fittingly, Bastille Day).

On May 19, barely 18 percent of voters participated in a special election to replace Hilda Solis, who gave up her 32nd Congressional District seat to become labor secretary. Eight Democrats, three Republicans and one Libertarian ran in this contentious race.

Although she finished first, Judy Chu did not win outright because she fell short of a majority (50 percent plus one). The race now goes to a July 14 runoff election – but it won’t be between the top two finishers, who were both Democrats. Instead, the top Democrat (Chu) will square off against the top Republican (who placed fourth with 10 percent of the vote) and the top Libertarian (who barely mustered 1 percent).

Three things are certain in this race. First, Chu is the odds-on favorite in this overwhelmingly Democratic district. (Last year, 68 percent of its voters chose Barack Obama for president.) Second, taxpayers face a steep tab for this election. According to the Los Angeles County Clerk/Registrar Recorder, it will cost taxpayers over $1.5 million.

Finally, a minuscule number of fatigued voters (perhaps as low as 7 percent) will show up for the July 14 runoff. While the voters stay home, the taxpayers’ tab goes up: The cost of administering the runoff will approach a staggering $100 per voter.

Fortunately, there’s a better way to conduct special elections to fill vacancies. Using IRV would allow us to elect majority winners using one election, instead of two.

Under IRV, voters get to rank their choices (1, 2, 3).  If your first choice cannot win, your vote automatically goes to your second (i.e., runoff) choice. It’s like conducting a runoff election, but in a single election.

The recent special runoff was no isolated case. In fact, a whopping seven of California’s past 11 special elections for federal or state office have gone on to runoffs. In all of those elections, the top candidate from the majority party has always won the runoff.

These “special” elections have exacted a heavy fiscal toll. In the past two years, $9.3 million has been spent in Southern California alone on special elections. Of that amount, more than $3.6 million was spent on special runoff elections (including the upcoming July 14 Congressional runoff).

What’s more, this cascade of vacancy elections will continue unabated. By year’s end, voters in Ladera Heights will have been asked to vote a total of five times! In the fall, we’ll have races to replace Assemblyman Curren Price (now state senator-elect) and Rep. Ellen Tauscher (Obama’s nominee for undersecretary of state). The tab to us taxpayers? More than $5 million.

IRV has already been adopted by San Francisco, Oakland, Minneapolis, Memphis and Santa Fe. In addition, Arkansas, Illinois and Louisiana currently use IRV for overseas voters. Recently, the Los Angeles County Board of Supervisors held its first hearing on IRV. What’s more, the cities of Los Angeles, Long Beach and Pasadena are seriously considering IRV.

A number of leaders and civic groups have endorsed IRV, including Obama, Sen. John McCain, California Controller John Chiang, California Secretary of State Debra Bowen, Los Angeles City Attorney-elect Carmen Trutanich, the Los Angeles Area Chamber of Commerce, Los Angeles League of Women Voters, California Common Cause, Los Angeles County Federation of Labor, Asian American Action Fund and Southwest Voter Registration Education Project.

As part of the governor’s proposed budget solutions after the May 19 statewide budget election, he should include using IRV, as it would save critical funds and chip away at our dire $24 billion shortfall.

Let’s do away with our multimillion-dollar election madness. Let’s adopt IRV – and fill vacancies by electing majority winners in a single special election.

Gautam Dutta is Deputy Director for New America Foundation’s Political Reform Program. Ted W. Lieu is a California Assemblymember (53rd District).

Budget Shocker: Things Are $3 Billion Worse Already

Thursday, May 21st, 2009

While the Big Picture Team at Calbuzz prefers to view the foibles of state government from 30,000 feet (See: Convention, constitutional), our Green Eye Shade Division is equally committed to keeping an eye on that pesky budget deficit that has Sacramento in a mighty dither.

Here’s their one word report from today: AAAAGGGHHHH!!!

Just as Governor Deltoids and Delta Force Legis were limbering up to slash $21 billion from the budget, along comes analyst Mac Taylor to clue them in that the deficit is closer to $24 billion – not to mention that a great many of Arnold’s proposed solutions are bushwah.

Greg Lucas, Calbuzz’s well-informed source about all things fiscal, blogs a complete report here.