Hearing on Phillips 66 oil-by-rail plan continues to April

The San Luis Obispo County Planning Commission on Friday, during a fourth day of a hearing on a proposal by Phillips 66 Co. to bring oil by rail to its Nipomo Mesa refinery.
The San Luis Obispo County Planning Commission on Friday, during a fourth day of a hearing on a proposal by Phillips 66 Co. to bring oil by rail to its Nipomo Mesa refinery. dmiddlecamp@thetribunenews.com

The San Luis Obispo County Planning Commission began deliberating Friday on Phillips 66 Co.’s plan to upgrade its refinery to receive crude oil by rail, after listening to more than 400 public speakers over four days on the controversial proposal — not including the thousands of letters, comments and resolutions sent from around the state.

But Planning Commissioner Jim Irving said Phillips 66 may not get a final decision on its project for five years because it may face challenges over both state and federal laws. “This is going to go from us to (county) supervisors, to the Coastal Commission, to the Supreme Court.”

The commission will continue deliberations on April 15, and then most likely again on May 12, at which time a decision could be made.

Phillips 66 has applied to San Luis Obispo County to build a 1.3-mile rail spur with five parallel tracks from the main rail line to its Nipomo Mesa refinery, an unloading facility at the refinery and on-site pipelines.

County planning staff has recommended denying the project, which as proposed would allow five trains a week, for a maximum of 250 trains per year to deliver crude oil to the refinery. Each train would have three locomotives, two buffer cars and 80 railcars carrying a total of about 2.2 million gallons of crude oil, according to county planners.

Representatives from Phillips 66 urged the commissioners to approve an alternate plan to allow three trains a week instead of five, or a maximum of 150 trains a year.

In three previous days of hearings, hundreds of people from around the state packed the meeting room, many condemning the proposal out of fear that an oil train derailment anywhere along the route would be disastrous. Supporters at previous meetings, many of them Phillips 66 employees, had defended the proposal, pointing to the refinery’s good safety record and the jobs it provides.

Commissioners plunged into deliberations as soon as public comment ended about 2 p.m. Friday, first discussing the issue of federal pre-emption, or whether the county is unable to impose local regulations on a federally regulated rail line.

Phillips 66’s assertion that pre-emption exists on the main rail line probably is correct, San Luis Obispo Deputy County Counsel Whitney McDonald told commissioners.

But once the rail cars leave the main track and go onto Nipomo Mesa refinery property, those federal laws no longer apply, she said — with a caveat that if Union Pacific is still operating the trains once they enter Phillips 66’s property then some federal laws could still apply.

That prompted Commissioner Don Campbell to comment: “We’ve heard a lot of comments from people 250 to 300 miles away, but I assume we’re still basically talking about this piece of property and really can’t enter into a thought process (about) something that’s 200 miles away.”

But McDonald advised differently, saying the commission could consider impacts along the main rail line because the county is charged with carrying out and implementing state law and policy.

“We are required to look at the trickle environmental effects of a project we are evaluating and if we approve it, what may happen as a result,” she said. “And what may happen as a result may need to be addressed by other agencies.”

The commission also discussed environmentally-sensitive habitat that was found on the refinery property after the initial draft environmental impact report was recirculated.

On April 15, the commission will discuss crude oil composition, hazards and emergency response issues, and air quality issues.

Friday hearing drew many supporters

Similar to its Feb. 25 meeting, planning commissioners heard from more supporters than opponents Friday.

Most of the 200 speakers during the first two days of hearings, on Feb. 4 and 5, urged the commission to reject the project, and sign-carrying protesters gathered across the street to drive the message home. But many of the 100 speakers on the third day of the hearing were in support.

At times, Friday’s hearing took a more hostile tone as some project supporters criticized opponents’ claims and said they should avoid petroleum-based products.

“I’m afraid county planning staff and those who oppose the project are cowards,” Atascadero resident Gary Kirkland said. “We need this oil, and we need this project, and we shouldn’t make a decision based on fear.”

Grover Beach resident Krista Chaney called the opponents hypocrites, adding: “They drove here in a car. We use dozens of things every day made from petroleum and oil. They are spreading lies and fear to kill an industry they would be lost without.”

She said the project would save jobs, provide a tax base and produce products that are used daily.

But for their part, some opponents questioned Phillips 66’s assertion that it needs to bring in crude oil by rail to offset declining supplies in California, and called the company’s claim that they need the project to protect jobs “bogus.”

“In the last decade, California’s overall crude production declined by 10 percent, but that’s not the case here on the Central Coast, which has nearly doubled over the same period,” said Mike Davis of Nipomo.

Phillips 66 Maintenance Superintendent Jim Anderson said crude oil production has been on a long, slow decline since 1985, but that situation became more dire last May when the pipeline that was responsible for the Refugio oil spill near Gaviota was shut down.

“You can’t run a manufacturing business without a raw material,” he said. “We don’t talk about plant closures, we talk about maintaining the viability of the refinery.”

Anderson said that if onsite impacts and main line impacts are separated, the three-train-per-week scenario would result in no “Class 1” impacts — the highest level of negative impacts — on the refinery property and would result in a lower health risk assessment than exists today.

The county staff report states that three trains a week — or 150 a year — would reduce the significant toxic air emissions so they would no longer be considered a “Class 1 significant impact” at the refinery.

But emissions of diesel particulate matter would still remain a “Class 1” impact on-site, according to the staff report, and there would still be 10 “Class 1” impacts along the main rail line, such as impacts to air quality, water resources, potential demands on emergency response services and an increased risk to the public in the event of a derailment.

On Friday morning, many of those who commented before the commission’s morning break said they traveled to San Luis Obispo County from Southern California to support Phillips 66 and United Steelworkers members.

Some work for Phillips 66 or are union members; others said they were affiliated with the South Bay Center for Community Development, based in Wilmington, which has partnered with the union and the refinery to provide job opportunities for the community.

Phillips 66’s Los Angeles refinery is made up of two facilities in Carson and Wilmington.

“We’re talking about directly benefiting 200 households, providing jobs for these people,” said Noel Genuino, who works for the nonprofit organization and was wearing a United Steelworkers shirt.

Cal Poly student Paul Sullivan, who is pursuing a master’s degree in computer science, also spoke in support.

“I think that any jobs we can find, especially in this area, is something we really need to work for,” he said. “I think that the environmental (impacts) and danger of the project is definitely overstated and a lot of students agree with me.”

The speakers in opposition included Grover Beach City Councilwoman Miriam Shah, who said that blocking the project “may very well be our last chance to control the rail lines that run through the coast.”

“I can’t see a reason to put any more pollution into the environment and into (residents’) lungs,” she said.

Cynthia Lambert: 805-781-7929, @ClambertSLO