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Pollution Payola

State officials allowed Tosco's Avon refinery east of Martinez--one of California's largest polluters--to increase dioxin discharges into San Francisco Bay shortly after the company donated $70,500 to Governor Gray Davis.
Posted on Mon, Jul. 29, 2002

Permit OK'd after donation to Davis
By Paul Rogers
Mercury News

State officials allowed one of California's largest polluters to increase toxic discharges into San Francisco Bay shortly after the company donated $70,500 to Gov. Gray Davis, a Mercury News investigation has found.

The decision by a key state water board in June 2000 came just four months after the board had refused to relax the pollution permit at Tosco's Avon refinery east of Martinez -- and after the company had tried unsuccessfully to get the rules eased for seven years.

A review of state campaign records found that the day after the water board voted not to ease the pollution limits on Feb. 16, 2000, Davis -- who appoints the board's members -- received $55,500 from Tosco.

That donation was 10 times larger than any other single donation Tosco had given Davis during his governorship. An additional $15,000 followed before the board issued its unusual reversal.

Davis officials say there is no connection between the donation and the decision to allow Tosco to increase its dioxin releases five-fold.

``There is no way in the world that contribution had anything to do with policy, because it is public for all the world to see,'' said Davis spokesman Steve Maviglio. ``Any allegation to that effect is ludicrous.''

But environmentalists and other critics say the timing suggests a troubling connection.

``I am astounded,'' said Richard Drury, an attorney for Communities for a Better Environment, based in Oakland. ``The implication is that the Davis administration was willing to sacrifice the health of San Francisco Bay for campaign contributions.''

One of the most toxic synthetic chemicals known, dioxin accumulates in fish and has been linked to cancer, immune system problems and reproductive disorders.

On June 20, 2000, reversing its February decision, the San Francisco Bay Regional Water Quality Control Board voted to relax Tosco's water pollution permit to allow an increase in the amount of dioxin its refinery could release into bay waters.

The board's reversal was ruled illegal by a San Francisco judge last week.

The disclosure that an oil company made large contributions to Davis, and then finally won a loosening of its water pollution permit, comes amid other accusations that Davis, since taking office in 1999, has aggressively raised funds and linked those donations to policy decisions.

The governor's most high-profile fundraising controversy has been the case of Oracle, in which the Redwood City company gave a $25,000 check to the governor's staff almost immediately after the state purchased millions of dollars of software it might never need.

``In a lot of ways, this Tosco case is worse than the Oracle case,'' said Drury. ``Oracle dealt with software. In this case, they decided to sell out human health. Dioxin is a deadly chemical. The whole thing makes me sick.''

Lawsuit upheld

Upholding a lawsuit from San Francisco Baykeeper and Communities for a Better Environment, Superior Court Judge James McBride ruled last week that the water board members ``abused their discretion,'' and cannot legally issue a permit under the Clean Water Act to an oil refinery without setting specific health-based water quality standards.

The judge ordered the issue back to the regional water board to be reworked.

Davis' rival in this fall's gubernatorial election, Republican businessman Bill Simon, called on the governor to return the Tosco contribution.

``This doesn't pass the straight-face test,'' said Simon spokesman Sean Walsh. ``This is simply business as usual for Gov. Gray Davis. His history as a professional politician is littered with pay-to-play campaign contributions coinciding with important votes that impact the environment.''

Tosco no longer exists as a separate company. It was bought by Phillips Petroleum in September for $7 billion.

Rich Johnson, a spokesman for Phillips, said the company has no comment on the Davis campaign donations.

Tosco's Avon refinery, built in 1915, was purchased by Tesoro Petroleum, of San Antonio, in February.

Reputation for polluting

While Tosco operated in Contra Costa County, the Avon refinery established a reputation for pollution and safety violations.

In February 1999, a fire killed four workers and wrecked a section of the refinery.

Dioxin was at the center of Tosco's biggest recent pollution battle, however.

The struggle started in 1993. Then, the regional water board set a strict limit for the amount of dioxin the plant could discharge into the bay down a two-mile long drainage canal from its Avon refinery.

The board said the company could release 0.14 picograms -- a picogram is one trillionth of a gram -- per liter of water. But after years of trying, and steady progress, Tosco announced it couldn't get to the standard. After several years of appeals and lawsuits, the water board in February, 2000 reissued its permit at the 0.14 standard.

Tosco said it would cost $10 million to install filters to reach the standard. At one point, Tosco Refining President Dwight Wiggins threatened to close the refinery and lay off 700 workers if the water board didn't back down.

Four months after the board held its ground, at the June meeting it changed course. Instead of the 0.14 standard, board members voted 5-1 to allow the refinery to keep releasing dioxin at 0.65 picograms per liter. They said they would set a new standard by 2012, when the EPA was scheduled to come out with a report listing all sources of dioxin in the Bay Area.

On Monday, the woman who chaired the water board said she had no knowledge of the $70,500 in donations leading up to the second vote.

``I can state categorically there was no communication from the governor to me or to any other member of the board concerning that contribution,'' said Josephine De Luca of Redwood City. ``We made the decision on the merits. It seemed to us it was the reasonable thing to do.''

The decision was opposed by the city of San Francisco, the California Nurses Association, the Golden Gate Audubon Society and the Women's Cancer Resource Center.

Board ruling explained

Larry Kolb, who was acting executive officer at the time, said the water board staff supported the change because it concluded that dioxin came from other sources, such as automobiles, into the air and was washing onto Tosco's property. It would be unfair to make Tosco spend millions cleaning it up, he said.

But EPA databases show the refinery, now called the Tesoro Golden Eagle, was the second largest industrial source of dioxin air pollution in the nine-county Bay Area in 2000 -- behind only Tosco's other refinery in Rodeo.

"If you've got air releases coming from the smokestacks, why wouldn't the water board use its authority?'' said attorney Michael Lozeau with EarthJustice, an environmental group. ``They decided to keep the blinders on, and bend the rules.''

The Davis administration has until August to decide whether to appeal the judge's ruling forcing a new pollution limit for the refinery.

``I don't think the fact that they gave Davis $70,000 means that he called all the board members and got them to change their vote,'' said Arthur Feinstein, executive director of the Golden Gate Audubon Society. ``But it sure looks lousy. I'm sorry it happened.''
Contact Paul Rogers at  progers@sjmercury.com or (408) 920-5045.

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