Oil Watchdog

Santa Monica, CA –Three months ago, Assembly Speaker Fabian Núñez
stood next to a Chevron gas station in downtown Los Angeles and vowed
in strong language to "curb oil company machinations that drive up
gasoline prices." The Foundation for Taxpayer and Consumer Rights
(FTCR) says in a letter to Núñez that "the result has been a great
disappointment: weak original proposals, harmful amendments and
additional legislation that directly benefits oil companies at
consumers’ and taxpayers’ expense."

FTCR has also asked the state Fair Political Practices
Commission to investigate a $50,000 donation by Chevron, and directed
to "Assembly Democrats," apparently made in connection with a Núñez
fund-raiser April 13 and 14. The donation exceeds by nearly $20,000 the
amount that may be used for electing candidates.
Read the FPPC letter here.

The letter to Núñez additionally criticizes a $100,000 donation
by Chevron to pet cause of the Speaker, a ballot initiative altering
term limits and allowing him to stay in his leadership post for an
additional six years.
Read the full letter to Núñez here.

"Our disappointment about the gasoline-related bills is
magnified by the ability of companies like Chevron to insert money into
the political dialogue and neuter oil industry reforms year after
year," said the letter. "This money pipeline is even more disturbing
when its connections to legislative action are cloaked from public
scrutiny."

In the letter, FTCR grades each of the oil industry-related
bills writer or backed by Nuñez, and the average is a disappointing
D-minus.

The letter’s "Report Card" list:

– AB 1552 – Refinery Information. – This helpful bill to
increase the operational, cost, storage and fuel transportation
information that refiners must provide to the state is mostly unscathed
so far. … Unfortunately, none of the specific refinery information
will be made public, under the fiction that it is all "trade secrets."
… Also disturbing is the likelihood, according to legislative
sources, of weakening amendments in the Senate. Grade: B-minus.

– AB 868 – "Hot Fuel." (Davis) – As a remedy for the "hot
fuel" ripoff of motorists, this bill promises no more than studying a
study, with no assurance of any legislative fix. … There is no
question that California drivers lose at least $450 million a year when
they buy gasoline that has expanded to temperatures above 60 degrees.
… The U.S. Senate is already considering legislation (S.1997,
McCaskill) that would require temperature compensation in the retail
sale of fuel. Yet, though California is the most affected state, AB 868
would merely delay a real fix. Grade: D-minus.

– AB 1610 – Refinery Oversight – An originally good bill
that would add some direct state oversight to the operation of
refineries, its current weakened state shows the power of a tiny change
of phrase. [A] brief amendment hands majority control of a new
refinery-operations oversight board to gubernatorial appointees. It
removes from the board … the independently elected Attorney General
and state Controller. The amendments slash any fig leaf of independence
and could create a state-sanctioned defender of the oil industry rather
than a watchdog. Grade: D.

– AB 118 – Biofuel Development – Pretends to be a
successor to last year’s narrowly defeated green-fuels ballot
initiative, Proposition 87. But instead of imposing a modest extraction
fee on oil companies, it cynically puts the full cost burden on
consumers. The measure would undercut any later effort to reap part of
oil and gasoline profits for renewable energy. No wonder the oil
industry’s mouthpiece, the Western States Petroleum Association,
officially supports the bill. Grade: F.

– SB 98 – State Tax Relief – Chevron … stands to be one
of the big beneficiaries of a tax break estimated to cost California
more than $850 million in revenue when fully implemented. You pushed
this last-minute measure through the Assembly as it approved the
state’s budget in a late-night session. SB 98 would allow a company
that has huge sales outside California and substantial property and
payroll in-state (as Chevron does), to use a different [tax] formula
that would substantially cut its state taxes. … at a time when state
programs, including transportation, are being slashed from the budget. Grade: F.
[After this letter was sent, SB 98 was omitted from the final budget deal]

All of the above bills, except for SB 98, have passed the
Assembly and their initial Senate committees, said FTCR. SB 98 was, as
it richly deserved, killed in the compromise over the state budget this
week.

Regarding the Chevron donations, the letter said:

Chevron, for instance, gave $100,000 on July 23 to one of your
chief causes, a February ballot initiative altering term limits that
would allow you to extend your term as Assembly Speaker by six years.
The donation arrived after the weakened oil industry bills passed the
Legislature. Your chief staff consultant, Gale Kaufman, is the
spokesperson for the committee.

We are equally troubled by a $50,000 donation this year by
Chevron to the California Democratic Party that appears to be tied
personally to you. The April 5 contribution is reported by Chevron, in
an atypical manner, as designated for "Assembly Democrats." Sources
within the Democratic Party confirm that these are funds solicited in
conjunction with your "Speakers Cup" fundraising event [in April] …
and which you will dispense. There is no question that raising funds
from the state’s largest oil company for the reelection of your
Assembly members, then quietly compromising oil industry reform bills,
creates a cloud over your office. The easiest course for you to clear
the cloud is for you to return Chevron’s contribution.

– 30 –

The Foundation for Taxpayer and Consumer Rights (FTCR) is the
state’s leading consumer watchdog group. For more information, visit us
on the web at: www.ConsumerWatchdog.org and www.OilWatchdog.org.