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California's Green Conundrum Surfaces Near Santa Barbara

Jun 2, 2009
There is no better example of the conundrum in which Gov. Schwarzenegger and all Californians find ourselves than the controversial oil drilling deal off Santa Barbara County.

On the one hand, Schwarzenegger and the state are world leaders in public policy to reduce energy consumption and promote renewable energy development. On the other hand, we're broke and a deal allowing Plains Exploration Petroleum (PXP) to extract oil from state waters near Vandenberg Air Force Base would provide the state government roughly $200 million a year for a decade.

Right now, Schwarzenegger says do the deal. Lt. Gov. John Garamendi and State Controller John Chiang say no way.

A little background. Last year, a collection of environmental organizations lead by the Santa Barbara-based Environmental Defense Center announced they had cut a deal with PXP. Under the Tranquillon Ridge plan, the Texas-based company would use an existing platform located in federal waters to extract petroleum underlying adjacent state waters (the state controls waters within 3 miles of the coast). In exchange, PXP would shut down the platform and three others in the Santa Barbara Channel by 2022, donate 4,000 acres of land for public use, and pay the state about $2 billion in royalties.

In January of this year, the State Lands Commission, composed of the lieutenant governor, the controller and the director of finance, voted 2-1 to prohibit the drilling. The Commission well, Garamendi and Chiang said the threat of an oil spill was too great, complained about the private nature of the deal, claimed that it was not really enforceable, and pointed out that the federal government could override the agreement and prevent the planned oil drilling platform decommissioning.

Considering that the State Lands Commission has jurisdiction over state waters, the 2-1 vote appeared to be the end of the Tranquillon Ridge deal. But did I mention that the state is broke?

The governor's May budget revise included authority for Finance Director Mike Genest to supercede the State Lands Commission and approve the Tranquillon Ridge oil drilling lease.

As you might imagine, this move did not set well with Garamendi and Chiang. At a State Lands Commission hearing in Santa Monica on Monday, they voted 2-0 for a resolution urging the Legislature to reject the "end-run around the Commission's decision regarding the Tranquillon Ridge lease." (The panel's third member, Deputy Finance Director Tom Sheehy, who had defended the governor's plan, left the meeting early because of a family emergency.) At the hearing, environmental groups that had supported the quid pro quo with PXP began backing away, saying they don't want to circumvent the State Lands Commission.

This hot potato is now in the hands of the Legislature, which already has more scalding spuds than it can juggle. An additional $200 million in annual revenue, even if it doesn't start flowing for a year or two, is awfully hard pass up in the face of eliminating health care for a million children and closing 200 state parks.

Back to that other hand: If California approves the first oil drilling leases in state waters since 1969, how seriously are we to take the state's commitment to the not-always-convenient fight against climate change?

Cities and counties wondering what SB 375 is going to do to their land use authority are watching closely.

- Paul Shigley
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