The Hermosa Beach Oil Settlement Agreement is Not Legal

Why has no one on the City Council read the Macpherson mock jury trial documents or transcript?  The threat of bankruptcy was the basis for was for a $17.5M settlement and extortion vote and no one has read the documents?

Before you read this you should review the contract agreement comments. In a properly negotiated & compromised settlement agreement, "neither party should be happy"with the outcome.  In this settlement agreement Hermosa Beach tax paying residents lost while the lawyers, City Council and oil won regardless of the outcome of the vote.  Here are some very important questions for our proud elected officials: Council Member Patrick (Kit) Bobko, Hermosa Beach City Attorney Michael Jenkins and Michael Divirgilio.

Drilling Down Article 

1)  If there was such a real likelihood that Macpherson Oil would win a court award for HUNDREDS OF MILLIONS OF DOLLARS ($750 million,), then why did Macpherson Oil settle for a mere $30 Million or 4% of his asking price?   Did Macpherson believe that, even if they won the jury trial, they would likely receive substantially less than $30M, or probably even NOTHING (see below)?  

2)  Was the 1995 “STOP OIL” ELECTION FLAWED because the “City Attorney (Jenkins) Impartial Analysis” in the election pamphlet failed to advise/warn voters of the real possibility of a Breach of Contract lawsuit to recover POTENTIAL LOST PROFITS? Were Hermosa Beach voters properly informed about the potential consequences, including tremendous financial liability, of the Proposition E vote in 1995? What law firm was providing City Attorney services to Hermosa Beach during this decade/period of time? Weren’t Bobko and Jenkins both employees of this same law firm - Bobko's current employer RWG Municipal Law Firm (of which he is now a Partner)?

3) Until 2001, Hermosa Beach City Attorney services were being provided by (Bobko’s & Jenkin’s) RWG Municipal Law Firm, represented by RWG Employee Michael Jenkins. From 2001 and onward, Michael Jenkins law firm began providing City attorney services to the City, including providing oversight services on the law firms defending the City from the MacPhersson lawsuit.  After the MacPherson lawsuit was filed, why didn’t RWG admit there had been and omission/error, and advise the City to hold a new election? (The 1995 measure passed by a mere 565 votes). Why didn’t Jenkins (after he/his law firm began providing City Attorney services to Hermosa)? Why didn’t Bobko (after being elected to the City Council)? 

4)  Could damages even be awarded to MacPherson by a jury (under directions provided by the presiding judge) due to failure of Macpherson Oil to make reasonable efforts to “mitigate damages” over the past 15+ years, as required under California law, by insisting on a new vote with a new proper City Attorney Impartial Analysis?  Did Macpherson sue because he could NEVER meet the TERMS & CONDITIONS of the LEASE imposed by the Coastal & State Lands Commission?  Did Hermosa Beach trial lawyers including Michael Jenkins purposely ignore evidence that could have won or minimized damages?  

5) Because of Bobko's associations with RWG Municipal Law Firm and Michael Jenkins, did Councilmen Bobko have a “CONFLICT OF INTEREST” in negotiating and voting on the settlement agreement? Shouldn’t Bobko have RECUSED himself, as required under California law from all such activities.  Has Bobko violated the Brown Act?  

6)  Are these the reasons the Settlement Agreement was negotiated by Bobko in secret, and voted upon behind closed doors without public participation? Was Bobko just protecting the reputation of this law firm, and his friend Jenkins, to the detriment of the City? Why was the settlement agreement not discussed in public BEFORE City Officials signed the contract with a new 3rd party E&B before the scheduled jury trial in April of 2012? Don't neighbors heavily impacted deserve "a say" in that their property and lives could be heavily impacted? - That seems to be normal business practice with Tattoo parlors or new bars, etc

7) Is this the reason that this behind the closed doors settlement includes a requirement that the 1995 "Stop Oil  election be held again"?  By wiping out all City reserve funds if not passed. Are there also other implications with regard to attorney "errors and omissions"insurance and possible reimbursement to the City for its approximately $4M in legal defense costs?

Continue to read a list of more questions that need answers.

19 Fatalities, 60 Injuries & $230M in Property Damage Per Year from Pipeline Accidents

Fatalities, Injuries & Property Damage Per Year from Pipeline Accidents 

Who wants an oil and gas pipeline near their home? Not me and hopefully our neighbors don't either.

Pipelines average 19 fatalities and 60 injuries every year in the US.  Pipelines incidents in the US produce on average $230,000,000 worth of property damage.  A pipeline does not belong in Hermosa Beach, Redondo Beach or Torrance going to Exxon Mobile Refinery.  See these oil and gas pipeline incident statistics here.  

Matt Damon Promised Land Movie Review

We attended the advanced screening of the Promised Land movie on Tuesday, December 11 in Hollywood and here is our review.

Promised Land is one of the most informative & entertaining movies about real life and local economics in the United States today.  Just when you think you understand all of the characters in the movie there is a big twist to the story at the end.  The twist to the story at the end of the movie will make you question every source and quote you hear in the media and from City Council promoting oil and gas revenue benefits and jobs.

Here are some oxymoron examples our City Council is currently using in Hermosa Beach "environmentally safe oil drilling" and "carbon neutral".   These hypocritical marketing buzz words should make you question the agenda of City Council and why they are unwilling to hold a public debate on the oil drilling issue.  

The movie also shows you how divisive money and oil can be on a community.  It tears apart a small town that lacks intelligent political leadership and shows you the hidden corruption oil companies use to influence politicians.  Just like Hermosa Beach, there are hardly any educated people doing research or who understand the risks of doing oil drilling so close to homes.  In the movie a professor eloquently presents the risk factors of drilling to an audience at a public debate and turns the tide the oil drilling project.

The movie also shows you that our politicians have their priorities in the wrong place and should be thinking about our health and safety first before creating jobs.  Not surprising a politician is willing to say anything for some cash presented and favors.

It makes you wonder why the Hermosa Beach City Council is under a confidentiality agreement (page 4) and never presented the settlement agreement in a public forum for debate.  Sounds pretty corrupt and suspicious to me.  

Some critic lobbying groups have tried to discredit the movie by saying Middle East OPEC money has financed the movie  . . .

After all, the movie "is financed in part" by the United Arab Emirates (UAE), an OPEC member country.   

This is a stupid argument since 47% of the 27,000 fracked wells in the United States were for oil and 53% were for gas.  Fracking is not just about gas.  See DrillingMaps.com database for more details on fracking locations in US.

Please like Promised Land movie on Facebook.

Here is the the Promised Land Movie Trailer. 

Here is some ridiculous propaganda trying to taint the movie claiming a conspiracy about Middle East oil money is behind the movie exposed fracking to promote oil.  Excuse me . . . but there minority investments of Middle East oil money in just about every company in the United States and these claims are ridiculous   For Matt Damon to claim he didn't know where some of the money came from is completely legitimate.  

Josh Fox of Gasland discusses his view on the film about the oil and gas industry taking away and exploiting what we have work so hard to build.

Fracking in California Can Induce More Earthquakes

Josh Fox of Gas Land Movie reveals unregulated fracking going on in Los Angeles, California and could cause a major earthquakes in the near future.  The USGS is studying the relationship to fracking but regulation still seems a long ways off.  Oil and gas companies are not required to disclose fracking even though hundreds of wells in Southern Califoria have and are currently being fracked.

In Oklahoma , Arkansas, and in Ohio, earthquakes shake the ground and rattle nerves. But these quakes are not the work of mother nature. The USGS says a controversial oil production method called "fracking" is responsible for triggering them

Fracking is a drilling method where highly pressurized water, sand, and a cocktail of chemicals are injected miles into the ground to shatter the rock, which allows the oil and gas to escape. A critical part of this process is getting rid of millions of gallons of waste water. A common way to do that is to re-inject it back into the earth. And that's what can trigger an earthquake. E&B will tell you they are not doing the controversial "hydraulic fracking" but won't be specific on how their technique differs from the above.  Do we want to take this risk?  

Oil Pipeline through Redondo Beach to Torrance Exxon?

Hermosa Beach Pipeline to Exxon Torrance Through Redondo Beach

I guess Stop Oil Hermosa Beach just enlisted the help of 200,000 more people from Redondo Beach and Torrance who could feel the impacts of the proposed oil project.

Of course this was one of the last document posted on the Hermosa Beach E&B website.  Why would safety, noise or toxic air quality concern anyone from an oil company because they say everything is sooooooo safe?  E&B has minimized the safety impacts of this project and we plan to expose every last detail of facts they leave out.  Of course all the documents are posted as PDF and not searchable.  Its only 1000 pages to read.  However, feel free to start reading the noise impact study here.

E&B seems quite proud of their aesthetic renderings for the proposed drilling site.  However, there is no way to draw the winds or the toxic air we are going to be breathing.  I don't think anyone really cares how it looks when toxic air could be blown downwind to thousands. 

Cities That Have Banned Oil & Gas Fracking

Elections & City Council Bans

1)  Longmont, Colorado (Denver / Boulder Suburb) slaps drilling in face, Outspent 30-1 by oil and gas hacks, bans fracking within city limits. Not even close. 60%-40%.

2)  Mansfield, Ohio voters adopt Community Charter Amendment That Bans Toxic Injection Wells. Not even close 63%-37% 

3)  Ferguson, Pennsylvania voters approve Clean Air & Water Community Bill of Rights while banning injection wells, fracking & shale gas development.  52%-48%

4)  Not a ban but Carpinteria, California drilling initiative defeated oil drilling in 2010.  Blowout victory 70%-30%.

5)  Wellsburg, West Virginia City Council Banned Fracking

6)  Morgantown, West Virginia banned fracking and forced to zoning by judge ruling 

Read about more State initiatives underway.

I don't think people who have actually lived and own homes in Hermosa Beach, California have any intention of moving backwards to permit a century long ban of drilling in Santa Monica Bay. E&B is simply wasting our value time and City resources which could be better spent elsewhere.

E&B still has the opportunity to pack up their bags and go home to save face. 2014 is a long way away.

Please email any others I may have left off to jeff@drillingmaps.com

Carpinteria Oil Drilling Initiative Defeated

Carpinteria Oil Drilling Initiative Defeated, Measure J (June 2010)

Yes: 944 (29.94%)

No: 2,209 (70.06%)

Measure J (Venoco's Oil Drilling Initiative) from Ted Rhodes on Vimeo.

A Carpinteria Oil Drilling Initiative was on the June 8, 2010 ballot in the City of Carpinteria in Santa Barbara County, where it was defeated. The primary effect of Measure J would have been to approve a slant oil and gas drilling project proposed by Venoco Inc. along Carpinteria’s coastline.  Real estate values were projected to decrease 10-15%.  Please read the Carpenteria Environmental Impact Report (EIR) which reveals some scary facts. 

Posing as a so-called "people's" initiative, Measure J was an attempt by Venoco to bypass local city government review and oversight. As the only donor to the pro side of the ballot measure, Venoco spent well over $600,000 – compared to $80,000 spent by Citizens CAP (Committee Against Paredon Initiative) that was raised from hundreds of individuals – trying to convince the voters of our small town as to the benefits and safety of their proposed massive oil drilling Paredon Project and why Venoco should be allowed to bypass all the local rules and regulations everybody else in Carpinteria needs to follow. Read more details here.

	MEASURE J: Shall the General Plan/Local Coastal Land Use Plan of the City of Carpinteria be amended and a Specific Plan adopted to authorize development of the Paredon Project, a private development project to explore, develop, produce and gather offshore and onshore oil and natural gas resources and transmit them to the Carpinteria Oil and Gas Processing Facility operated by Venoco, Inc.?

Hypocrisy of Councilmen Kit Bobko & Michael Divirgilio

Listen to Hypocrites Bobko & Divirgilio Rant About Transparency

Smart financial move - Beach Reporter Letter From Howard Longacre - October 18, 2012

During the Oct. 9 Hermosa Beach City Council meeting, all concerned had to again endure the self-righteous, condescending, bullying insults and obstruction from Councilmen Michael DiVirgilio and Patrick Bobko regarding a revised banking relationship with the Bank of America.

These two sneaky councilmen owning no property, home, or business in Hermosa Beach, having no historical roots in the South Bay, having both moved and rented units here after briefly renting in Redondo (obviously to use Hermosa Beach for their political self-aggrandizement) have both, more than worn out their welcome.

DiVirgilio and Bobko's badgering questions and ridicule on Oct. 9, nauseously mocked a well-researched revision to the long-neglected banking contract. Hermosa Beach will now see its present $24,000 yearly banking charges completely eliminated. And additionally with new cash credits to be received into Hermosa's account; a net savings to Hermosa's treasury of over $140,000 during the next five years, and without a necessity of expending $75,000 to change banks.

DiVirgilio and Bobko insulted virtually everyone with their pre-planned, disgusting and despicable attacks. They seemingly even elicited an Executive Director of the Hermosa Beach Chamber of Commerce (conveniently a local officer of a banking corporation appropriately rejected from consideration) to complain at the meeting.

DiVirgilio and Bobko's attempt to deceive and manipulate the minds of the public and press with their disingenuous drivel regarding "transparency" and process, was just more illustration of their increasingly offensive and self-serving behavior that wastes and disrupts council meetings costing several thousand dollars per hour.

Much appreciation for this successful new banking contract belongs to Mayor Jeff Duclos, Councilman Peter Tucker, Councilman Howard Fishman, Interim City Manager John Jalili, City Manager Tom Bakaly, the city's finance department staff including the deputy city treasurer, and especially City Treasurer and the financial officials of neighboring cities and agencies who freely gave of their expertise and wisdom.

Howard Longacre 

Bobko and Divirgilio are the same two guys that negotiated (without a public hearing) a deal that is not legal and they have conflicts of interest along with other City officials.  The hypocrisy of Hermosa Beach City Councilmen Kit Bobko and Michael Divirgilio is appalling.  Only 1 only company bid on the deal and they made the city borrow $17.5M with no public forum or RFP. A grand jury needs to investigate what is behind their confidentiality agreement. This video is from the Octorber 9, 2012.  Read more on the top reason this is a bad oil deal for Hermosa Beach.

The City Treasurer was anything but nontransparent taking bids from 19 banks and shared it with the public?   You took a bid on the oil deal from a friend Gary Brutcsh who sourced the deal to you?  Transparency?  Your untrustworthy voting record also speaks for itself.

Request for Open Forum to Discuss Illegal Deal Denied

Its a Legal Issue and Not a Voter Issue

Hermosa Beach Self Storage Lot & Civic Center Roulette

(Option 1) Drilling for Oil = Relocating City Maintenance Yard Here

(Option 2) Keep Current Hermosa Beach City Maintenance Yard

I was shocked to hear at the planning commission meeting that CITY STAFF and not the Planning Commission know all of the information about future plans of the City Hall.  New Downtown Civic Center? Apparently, Hermosa Beach's long term plan is to develop a downtown Civic Center.  This plan is now in jeopardy because of the proposed oil drilling project?  Why, because the City Maintenance yard would have to be relocated to the City own Storage lot across the street from City Hall.  What would happen to City Employee parking?  City Staff seems to think that the City Yard can be relocated onto the storage lot without disrupting the parking.

The City was planning to expand City Hall across the street to the Storage Lot above which makes a lot of sense.  But what more do they need downtown and hope to understand in the future?  Transparency please?

According to Mike Flaherty, Public Works Director say this.  "The EIR for the oil project has to address the City yard relocation.  Is E&B going to pay for the relocation?"  No.

Former Hermosa Beach City Councilmen Gary Brutsch said, "oil revenue from the Tidelands could pay for a police and fire substation on The Strand. Brutsch, "believes many people who were in favor of oil drilling in 1984 didn’t have the energy to defeat the anti-oil forces. Brutsch said, "he wanted to designate Hermosa Beach the environmental portal to the Santa Monica Bay by using tidelands revenues to install filters on storm drains that empty into the ocean."   See Easy Reader article.

Zoning for the new City Yard location next to homes would have to be reconsidered to light industrial.  Is the planning commission going to be involved oil EIR process?  Lets hope so.  Will the planning commission be involved in the EIR?  Lets hope so because I bet Planning Commission Chairman Ron Pizer has some input.

You might also want to read this. How does Hermosa Beach plan to pay $17.5M?

What Is Horizontal Shale Oil Drilling?

What E&B Natural Resources Doesn't Want You to Know

Here are the safety issues and risks of Slant Oil Drilling in Hermosa Beach that E&B Natural Resources doesn't want you to know.

1)  Chemicals and mud are pumped into the ground
2)  More black tar and oil on our beaches 

3)  Hole is drilled just under the deepest fresh water source from the surface. 

4)  Cement sealing always fail and thus why fracking contaminates water underground

5)  Drilling will go completely horizontal only under the Ocean. (1/4 mile)

6)  80 pieces of pipes at 495 pounds each to drill one well (2400 total pipes for 30)

7)  87 tons of pipe per well will be inserted into ground (2,610 tons of pipe for 30)

8)  Perforation gun inserted into ground for an explosions underground

9)  Hydraulic fracturing has huge safety issues under pressure

10)  Pump jacks may not be used so what will they be using?

Steve Layton says, "The best place to find oil is in an old oil field." = Fracking

Oil Companies Do NOT have to Disclose Fracking Sites in CA

Fracking is Still Highly Unregulated in California
See the Fracking Health Dangers of Gas Here


Baldwin Hills Oil Sink Hole in 1963 See (6 min 25 seconds)
Pressurized Oil Extraction Wells Caused This

Hydraulic Fracking Diagram

California Fracking Unregulated

E&B Oil Reveals Hydraulic Pumping Will Be Used

E&B further explains their hydraulic fracking technique using 27 oil wells and 3 water injection wells. The drilling rig will be 87 feet tall and will be temporarily on site for four months before it is removed. During that four month period three exploratory wells and one water injection well will be drilled. This will allow us to analyze the quality, along with the rate and flow, and other important factors of the produced oil, gas and water.

Pressurized Hydraulic Oil Extraction Wells Caused This
Redondo Beach Wins $2.5M Law Suit From Oil Companies in 1997

Eight oil companies named in the lawsuit were required to replace the oil they had taken with pressurized water. He said that because they did not, the surface under the water sank up to four feet in some areas. The subsidence led the breakwater to sink four feet below its designed height of 22 feet, Goddard said, and caused storm-generated waves to crash over the protective wall. He said the storm caused more than $8 million in damage to local businesses, a cost absorbed by the city. Several major oil companies were named in the suit, including Texaco, Exxon, Trident and Phillips Petroleum, Goddard said. 

Francesco Galesi, Chairman & Steve Layton, President of E&B Natural Resources

E&B Chairman, Francesco Galesi 

Francesco Galesi is the Owner & Money Behind E&B Natural Resources.  Mr. Galesi was one of the longest-serving directors of WorldCom Inc. He is one of just four board members on the crippled company's audit committee, which signed off on years' worth of cooked books that the company now says misstated $3.9 billion in costs as revenue. Worldcom is the 2nd largest bankruptcy next to Lehman Brothers in U.S. history. Gallesi is responsible for recruiting Scott D. Sullivan, WorldCom's "whiz-kid" chief financial officer, what has become one of America's biggest corporate scandals.  Read this article "The WorldCom debale, Through one Director's Eyes".

Mr. Galesi purchased he Alma and Equinox assets out of bankruptcy after the Steve Layton's Equinox Oil spill and formed E&B Natural Resources.  In 1969, Mr. Francesco Galesi purchased and transformed surplus military depots in upstate New York and converted them into major Industrial Parks. The conversion of these properties subsequently led Mr. Galesi into the warehousing and distribution business. His visions led to further corporate growth and diversification with the acquisition and development of additional real estate holdings, including residential and commercial sites, the acquisition and restoration of the historic Equinox Resort in Manchester, VT, and ownership in E&B Natural Resource Management Corporation, an oil and gas company.  It has also been reported that Mr. Galesi and his wife recently rented a home in Hermosa Beach to promote their new investment.  

E&B President, Steve Layton

Steve Layton has served as President of E&B since 2000. During his career, Mr. Layton has been actively involved in building and managing several oil and gas companies including two that were acquired by Francesco Galesi in 2000 along with E&B Natural Resources.  In 1983, Mr. Steve Layton co-founded Alma Energy and Equinox Oil with his father and Mike Galesi. He served as President of Alma and Equinox from 1997 to 2000. In November 2000, Francesco Galesi purchased the Alma and Equinox assets out of bankruptcy after a massive Louisiana oil spill and formed E&B Natural Resource Management Corporation. Mr. Layton was retained as President of E&B.  Mr. Layton is a member of the Board of Directors of the Louisiana Independent Oil and Gas Association and the California Independent Producers Association. Mr. Layton has also served as a Director and as Governor of the Houston Region for the Independent Petroleum Association of America and as President of the National Stripper Well Association. Mr. Layton earned a BS and MBA from the University of Tulsa.  Steve Layton reportedly purchased a home on Monterrey Blvd in Hermosa Beach in the Spring of 2012 to promote his oil interests in town.  

Joyce Fahey - Currently a Manhattan Beach resident, brings to bear more than 30 years of conflict resolution experience as a judge, attorney, elected official and, most recently, as Vice President, Governmental Affairs for Blackstone Oil & Gas, Inc. Judge Fahey transitioned to a neutral practice at ARC after her second term as Mayor of Manhattan Beach, CA.  Judge Fahey was appointed to the Los Angeles Superior Court in 1991. After her retirement from the Superior Court in 1997, Judge Fahey continued to preside over cases on an as-needed basis and served on the Retired Judges Mediation Panel.

In her position as Mayor of Manhattan Beach, Judge Fahey was directly involved in resolving a wide variety of issues, from litigation over public works projects, construction and environmental impact matters, to negotiating employment contracts for city employees. Recently appointed as a Trustee for the Manhattan Beach Unified School District, Judge Fahey has worked with school districts to resolve conflicts and has mediated disputes among neighboring cities. Judge Fahey is a recognized expert in cases involving child sexual abuse. She is also highly skilled in child custody and visitation matters. Judge Fahey is fluent in Spanish and Italian.

South Bay Residents Possibly on E&B's Payroll?
Cheryl Cross - PR C.A. Cross & Associates

An Ex-Hermosa Beach Fire Chief retired in 2007
Tiffany Rau - Consultant 

Hermosa Beach City Council Voting Record

Hermosa Beach City Council Voting Record

Kit Bobko & Michael Divirgilio are the dissenting votes or absent for all of these City Council Meeting votes?  

1)  Voted 3-2 No on Outsourcing Parking Meters

2)  Voted 3-2 Yes Hiring Tom Bakaly as new City Manager

3)  Voted 3-2 Yes to Ban Polystyrene
4)  Voted 4-1 Yes Banning Smoking on Strand & Pier Plaza
5)  Voted 4-0 Yes (Bobko Absent) Banning Smoking on Beaches
6)  Voted 3-2 Yes Approval of Bank of American Banking contract
6)  Voted 3-2 No Suspend City Treasurer Cohn who was a victim of extortion.

Oil Drilling Settlement Negotiations

The City Council seems to have a clear divide on most voting issues in recent months as described above.  However, I often have to scratch my head to understand the logic behind some of the dissenting votes in recent months.  Bobko and Divirgilio are clearly working as a team and it all seemed to culminate immediately after both launched a PR campaign to promote their oil settlement.  The big question is:  Why were the two of these guys negotiating our oil settlement deal together?  Shouldn't they have had Duclos, Fishman or Tucker in the room negotiating? Neither Bobko or Divirgilio own a home in Hermosa Beach.  It would have been impossible for a third City Councilman to participate in the negotiations because it would have been in violation of the Brown Act.  Were the residents represented properly?  I don't think so.  What business, lobbyists or people are motivating these two individuals to make make their voting decisions or press their unpopular agendas?

Outsourcing Parking Meters vs Replacing With Credit Card Machines

I think many residents who are disappointing about the City not even considering outsourcing are missing the point of Duclos, Fishman and Tucker voting no.  However, the City can always outsourcing at any point in time but lets take some baby steps and install credit card machines that we own first.  Some of the high salary and union problems might naturally go away over time.  90% of the problems can be solve by installing credit card machines and that does not require outsourcing.   The City currently collects $2.5M per year from coins and who knows we might be about to double this to $5M simply by putting in credit card machines and managing the price per spot during peak hours.  What if we charge $5 per hour for parking near the pier during peak hours.  Hint, hint . . .  this might control some of the alcohol related problems of people flooding into our city.  Controlling our own meters with credit cards is not that hard and Manhattan Beach has already demonstrated they can do it profitably.

Kit made faulty parallel assumptions that it works for Newport Beach, why not in Hermosa?  His PR was recognized in the national media blaming $100,000 meter maids as the problem?  Why did Kit conveniently leave out that installing credit card machines would have $0 cost to the city and would be profitable immediately.  This does not require outsourcing.  So, what his suggestion to outsource politically motivated or does he have the best interest of our city at heart?  Does he or his law firm RWG have any political ties to the large outsourcing firms that manage parking meters?  Does Kit once again have a conflict of interest he would like to explain?  Was he motivated to get a "deal" in return for some political donations down the road.

Kit routinely makes statements and negotiates deals that are not backed with any financial analysis.  Kit also does not appear to see the big financial picture or have a cohesive fiscal strategy as it relates to the affect on the community.  Kit is not a property owner and has no skin in the game.  He simply seems to look for revenue opportunities or ways to save money to further his political platform.  I wish Kit would simply more rational decision based on what is right for the community and not based a political ideology.  I am a conservative voter and thinker myself, however, I don't agree with much Kit's thinking or ideas as they pertain to what is best for our community.   

Councilmen Howard Fishman said the city should move immediately on replacing coin-operated meters with credit card parking meters to solve 90% of the problems. City Treasurer wrote a memorandum to the council encouraging the installation of credit card-accepting meters as other municipalities have done in order to increase funds and efficiency.  “With credit card meters, revenue goes up overnight,” Pete Tucker said.   Former Police Chief Greg Savelli, who now runs the parking enforcement department of the Los Angeles Department of Transportation, also spoke against outsourcing, saying the service the officers provide “goes beyond the balance sheet.”

“What we have now is fantastically expensive,” Kit Bobko said who seems adamant about cutting costs and saving money no matter what the outcome.  Outsourcing to save money or outsourcing to generate (oil drilling) is going to be a common platform for Kit to propel himself to a higher political office.  Kit gave no credible financial arguments justifying his outsourcing position.

Hiring Hermosa Beach City Manager Tom Bakaly

"First, let me say that I think without question that Tom was an impressive dude, and I think that he provides a lot of earned and demonstrated skills that meet our needs and that match quite nicely with our uniqueness," said Councilman Michael DiVirgilio.  Council votes 3-2.

"In Hermosa Beach, we're whistling past the graveyard because we are not having any financial troubles yet,” Bobko said. “We weren't going to stand firm and ask of our leader, the person who is in charge of our city's staff, to do what we want the staff to do, which is to pay for his own first contribution. That is deeply disappointing and I think a failure of leadership for this council…

I don't think either of these guys have much experience running a business or hiring and firing people.  My philosophy has always been to hire the best CEO you can get and pay him top dollar.  There are a lot of problems in the City right now and we need a strong, competent, financially oriented person to do the job.  I am confident Tom Bakaly was a great hire and will help turn the City around that has been neglected in many areas.

Banning Polystyrene in Hermosa Beach

Bobko and Divirgilio have been routinely voting together.  Bobko is a Registered Republican and Divirgilio seems to be a Democrat having worked for Jane Harmon.  However, the two of them seem to be singing to the same song when it comes to local voting matters.  They also don't seem to be able to sway the other 3 council members very often on their views.  Both Bobko and Divirgilio were dissenting votes (3-2_ as well on Hermosa Beach polystyrene ban.   This was shocking since Michael Divirgilio once led the Green Task Force in Hermosa Beach and pounded the table in his campaign about a City that needs to become "carbon neutral".

Banning Smoking on Strand, Pier Plaza & Beaches

It goes without saying who was the lone voter in the 4-1 vote to ban smoking on the Pier and Stand. Kit Bobko does not support banning smoking on the Pier or Strand.  Kit Bobko was also conveniently absent for the 4-0 that banned smoking on the beaches.  Does he have your health at interest or his political views?

Hermosa Beach Renegotiates Banking Contract First Time Ever Recorded

Bank of America has been the Bank of Hermosa Beach for over 40+ years. It would have cost the City over $100,000 to change banks.  Also, Treasurer Cohn renegotiated the current contract for the first time ever and was not touched by John Workman prior Treasurer.   Hermosa Beach was paying $24,000 per year in banking service fees and a $28,000 rebate?

Bobko and Divirgilio Accuse Treasurer Cohn of Sloppy Non-Transparent Work?

Sloppy?  Transparency?  Do Mr. Divirgilio and Mr. Bobko have a personal issue with Treasurer Cohn?  Aren't they being hypocritical about the City Treasurer lacking transparency in the bank bidding process of 12 banks? Correct me if I am wrong but you are the same to 2 councilmen that negotiated a $17.5M settlement with any transparency and 1 oil company? They seem to think the backroom oil deal is justified because of the ongoing litigation but you did brought in a 3rd party without any bidders. Their lack of due diligence and transparency on this deal is appalling and speaks for itself. We are talking about saving money in a banking relationship of $50,000 per year in banking fees vs a $17.5M check they wrote without any bidders while jeopardizing the health and safety of its citizens. I think the two of them have some explaining to do.  Their hypocritical voting record speaks for itself.   E&B loaned the City of HB $30M to settle the lawsuit with Macpherson. How many companies got to bid on this? Only 1 company sourced by Gary Brutsch and Michael Divirgilo and Kit Bobko. Why doesn't the LA Times investigate this?

Redondo Beach Considers Oil Drilling To Protect Reserves

Former Tritton Oil Drilling Site (Dirt Lot) Harbor Dr & Portofino Way in Redondo Beach

Former Oil Drilling Site 190th and Prospect in Redondo Beach

The Redondo Beach City Council took a the first step toward exploring oil drilling within city limits to boost city revenues on Tuesday. Read the RB Patch Article.

In a referral to staff, Councilman Steve Diels, who represents District No. 4 in North Redondo Beach, asked City Manager Bill Workman if city staff could examine whether Redondo Beach could tap into the "hundreds of millions of dollars" sitting beneath the city.

Additionally, Diels asked if city staff could look into the effects of possible oil drilling in Hermosa Beach on Redondo's reserves. Both cities sit on top of the Torrance Oil Field.

The councilman noted that money from potential projects could be used for various capital projects, and even implied that revenues from oil drilling could be used to pay for a park at the AES Powerplant site on Harbor Drive.

Bill Brand, who represents District No. 2. "In general, though, I don't support that kind of industrial activity going on in our town."

If the city does eventually decide to allow oil drilling, it would not be the first time oil wells were dug in Redondo Beach. According to the Redondo Beach Historical Society, wells dotted the city during the 1920s.

Lets not forget Tritton Oil & Gas Corporation abandoned the site in 1990 at 101 Portofino Way, Redondo Beach 90277.

Related Articles: 
Pat Aust recalls oil fire in Redondo Beach.
Tritton Oil & Gas Corporation oil well abandonment in 1990 
Hermosa pursuing legal action against Oil Operator Roy Stinnett in 1991 (LA Times)
Map of regional oil wells in the South Bay.
Is the AES Redondo Beach Powerplant Related to Hermosa Beach Oil Drilling

No Oil Money For Hermosa Beach Schools

Barbara Guild Speaking About Oil Drilling Underground In Ocean Benefits State of California (Tidelands Trust)

- No General Use of Oil $ From Ocean

- Schools Only Have Tiny Mineral Rights Royalty

- .20 Cents Per Barrel of Oil Extracted Under School

- No $ Use East of Strand

- No Police or Fire $
- No Road or Sewers $
- No New Building $
- No School $
- No Parks Money

State Tidelands Doctrine

The United States Supreme Court issued its landmark opinion on the nature of a state’s title to its tide and submerged lands nearly 110 years ago, and although courts have reviewed tidelands trust issues many times since then, the basic premise of the trust remains fundamentally unchanged. The Court said then that a state’s title to its tide and submerged lands is different from that to the lands it holds for sale. “It is a title held in trust for the people of the State that they may enjoy the navigation of the waters, carry on commerce over them, and have liberty of fishing” free from obstruction or interference from private parties. All uses, including those specifically authorized by the Legislature, must take into account the overarching principle of the public trust doctrine that trust lands belong to the public and are to be used to promote public rather than exclusively private purposes.

Evidence of Money Use in Newport Beach

Oil and gas revenue is deposited into the Tidelands Fund because the source of the oil is in the tidelands area which the City holds in trust for the people of California. The Tidelands Fund may be used only for eligible expenditures that support and maintain the tidelands, such as improvements to tidelands property including dredging Lower Newport Bay, lifeguards, beach cleaning, etc. 

The productivity of the oil wells continues to decline due to the age of the wells. New oil extraction techniques are required if the City continues to use the wells. The new techniques may include: reconditioning of existing oil wells, converting existing oil wells to water injection wells, drilling new water injection wells or drilling new oil wells. The City Charter restricted the redrilling of wells until January of 2011.

This is how we raise money for Hermosa Beach Schools through the Ed Foundation.

Commonly Missed Public Perceptions

1) Doesn't affect me where I live
2) City will be bankrupt if we pay
3) Schools will benefit and need $
4) They say drilling is safe

Hermosa Beach Neighborhood Watch Newsletter

JUNE NEWSLETTER FROM NEIGHBORHOOD WATCH

Are SOME Hermosa Beach City Council members trying to lull our community members into a false sense of security? Current objectives to reduce the salaries and benefits of our current and future Police and Fire personnel might change the course of our public safety forever!

Hermosa Beach Neighborhood Watch (HBNW) has expanded the advancement in public safety. We have made a difference in community awareness by partnering with the HB Police and Fire Departments. The information that is delivered through email to our citywide-connected, interested residents has proven success in the past six years. People are more aware of their surroundings and take part in crime prevention of their home and auto because they have access to daily crime logs. HBNW has worked closely with the Fire Department to bring disaster preparedness to the forefront of our lives. Through this association we have shared knowledge of the daily happenings on calls for service. This snapshot view makes visible to the public that the majority of calls are for medical emergencies and mutual aid to our neighboring cities.

We all have common aspirations when it comes to our safety. To HBNW coordinators, it is to maintain the growing beach community while keeping our sense of public safety top notch. We all want an environment to enjoy, relax in and be responsive to changing times.

The City and local economy is recovering from the recession that began in 2008. Revenues are up, a new business license fee was instituted and the City has settled the long on-going lawsuit with the oil company. The future is bright for the City. So why then, is the City Council intent on additional cuts and layoffs? Its arrogance and politics!

• They will say we have to pay the Oil Company; that bill doesn't come due for several years as it must await the outcome of the city-wide vote to approve oil drilling. We could also enter into a payment plan. What they don't say, is the million dollar a year payments to the attorney representing the City can now be saved to make the payment to the oil company (if necessary).

• They will say the retirement system is costing too much; costs of retirement for existing employees are rising, yet this is like a mortgage payment, we can't pay the whole amount, but the City can afford the payments. It is a tough concept for those on council who don't have a mortgage to understand this. They moved here for the sole purpose of becoming a politician in a small town with hopes it will lead to another political opportunity. These are the very same council members who want to tear down this once well run City. They also won't tell you that a few years before the recession the retirement system was "super-funded" and the City was not required to make payments. Did they run out and give employees raises? Nope, they spent the money on other things. Now that the payments are due, they want the employees to pay.

• They will say the cost of employee benefits are skyrocketing; True for some, but not for new employees because the tiered system. What they want to do is chase away (by threatening huge pay cuts, some as high as 30 percent) good long-standing, solid employees who are dedicated to providing service to the City. This will become a transitional City, where some will come for the experience and then move on to greener pastures when they discover how other Cities are working to support their employees, not cut them off at the knees. What they won't tell you is the employees of this City have not sought raises in five years in in an effort to help the City to balance the budget, oh and by the way, the City has had a balanced budget every year and revenues never went below the level in 2008. Money is tight, but there is no fiscal crisis, however, there is a crisis of leadership on the council.

• They will say there is too much "unfunded liability" due to employee pensions, medical benefits; They won't tell you that these costs were agreed upon by this City Council and previous Councils who negotiated in good faith when deciding how the benefits should be paid. They won't tell you the employee share, currently being paid by the City, was in lieu of raises to the employees and was a financial advantage to the City to pay the employee share, and still is. Oh and again they won't tell you that each of the employee union agreed during the negotiations process to the 'tiering' of the benefits, again in an effort to help the City. Now they want to take it away from the existing.

• Your Police Department was recently awarded accreditation from a national organization that audit and reviews the work done. This was because of the leadership of Chief Savelli, yet it was the officers and other employees of the department that made it happen. To thank them for becoming a leader in law enforcement, they want the employees to suffer more cuts. They won't tell you that because of the professionalism of its members, the City is saving thousands upon thousands dollars on lawsuits and attorney's fees. They also won't tell you they are spending your money on a high-priced labor lawyer to negotiate against their own employees. They love giving money to attorneys, perhaps they want to be attorneys some day.

• Hermosa Beach Fire has specially trained men to provide out-of-hospital care in medical emergencies. There are many different types of emergency medical responders, each with different levels of training, ranging from first aid and basic life support to advanced life support. Paramedics provide advanced levels of care for medical emergencies and trauma. ALL of our Hermosa Beach Fire personnel are trained fire fighters and paramedics. This is quite comforting when you find yourself in a position that you need to call 911 for help. In my humble opinion, knowing that individuals are on their way that can provide advance care is reason enough to fight for this service to stay in Hermosa Beach.

• The City has cut several positions, including two police officers and 20 percent (one assistant Fire Chief and three firefighter/paramedic positions) of the Fire Department. HB Fire is the busiest department for 'Call of Service' per firefighter/paramedic in the Los Angeles County. Compton Fire is number 2.

• The City also has "tiered" the retirement system for future employees and encouraged experienced employees and leaders to leave by offering a "golden handshake" and have not given employees raises over the past five years.

Please let them hear your voice, stop the dismantling of the City by this City Council. Tell them to support the City and the services provided by the employees. Remember, this is a great City with low crime and we want to keep it that way! Your Police and Fire Departments are never more than a mile away when you call, and their response time and service levels are unmatched.

The future of Hermosa Beach Neighborhood Watch program is DEPENDING ON YOU, individually and as a community, to speak up NOW to express your outrage that our voted representatives will keep in mind that it is a "convenient delusion" to think that relying on low wages and outsourcing in place of innovation and opportunity will make Hermosa Beach prosper economically or ethically. What is your families continued safekeeping worth to you? Our hope is that you will step up by calling, writing or sending an email to our five council members to voice your opinion before it is too late and a choice has been made for you! It is OUR collective responsibility to voice our wishes to keep the police department and fire department together.

We trust that you are as outraged at we are and put a stop to this "convenient delusion" that City Council has that by relying on low wages and outsourcing in place of innovation and opportunity will make Hermosa Beach prosper economically or ethically. What is our families continued safekeeping worth to you? Our hope is that you will step up by calling, writing or sending an email to our five council members to voice your opinion before it is too late and a choice has been made for you! It is OUR collective responsibility to voice our wishes to keep the police department and fire department together. We need to send the message that we do not put politics above people.

Email All Council Members

What is an Environmental Impact Report (EIR)?

Hermosa Beach is about to begin the Environmental Impact Report (EIR) process and its important that you know what it is, the timing, costs, players, politics & process.  An EIR is the planning document which describes the environmental impacts associated with a oil drilling project.

17 Environmental Impacts

The EIR will analyze 17 different environmental impacts and will determine which ones are significant. Aesthetics, Agricultural resources, Air Quality, Biological resources, Geology and Soils, Greenhouse Gases, Hazards, Hazardous Materials, Hydrology and Water Quality, Land use and Planning, Mineral Resources, Noise, Population, Real Estate, Public Services, Recreation, Transportation and Traffic, Utilities, Mandatory Findings.  It also describes mitigation measures to reduce the impacts to an appropriate or acceptable level.

Planning Commission & City Council

The information within an EIR allows the decision-makers (the Planning Commission and/or the City Council) to make an informed decision when considering whether or not to approve a project. The report also assists with deciding if approval conditions (entitlements) are necessary. The ultimate decision to approve a project, however, remains with the decision-makers. When the Planning Commmission or City Council approves an EIR, it is simply an acknowledgement that the EIR is true and accurate. It is only a step towards project approval, not a guarantee. The Planning Commmission or City Council may decide to instead decide to approve or deny the project based on overriding considerations. For example, the Planning Commission may find that a proposed project may provide monetary benefits to a community that don't outweigh a problems identified in the EIR, such as unsafe air quality, heavy truck traffic & real estate price decline that will negatively impact property tax revenue.

Public Review

There may also be one or more meetings about the report, either as a separate meeting or as an item in a Planning Commission agenda. Note that approval of the environmental impact report does not mean that the project is approved. Once the report is approved, decision-makers review the project, taking into account the information in the report and other considerations. The public has an opportunity to review and provide comments on a draft of an EIR by contacting, in writing, the planner listed on the EIR. Public input is then included in the EIR, and considered by the decision-makers along with other aspects of the report.

EIR Project Managers

The Hermoa Beach City Council approved a contract with Ed Almanza & Associates, a Laguna Beach firm, to serve as the project manager.  However, there is no public information on this firm available on the internet as of today which is concerning.  The firm will oversee the city’s review of the proposed project at large. The Council also approved a consulting contract with former City Manager Stephen R. Burrell.

Opinion:  "Can Voters Rely on an EIR to Make a Voting Decision?"

It is important for the entire South Bay to understand this will be the 4th time in 80 years that Hermosa Beach has been faced with an oil drilling ballot measure. Hermosa Beach overwhelmingly banned oil drilling in public votes in 1932, 1958 and 1995. An Environmental Impact Report (EIR) will address many aspects of this process, but it will never fully disclose all the damage that oil drilling will bring about in a town 1.3 miles square. Our position as a great area to live will be severely tarnished. These safety and environmental damage resulting from oil drilling will effect generations to come.

An EIR is supposed to be a thorough analysis of: Air quality, Biological resources, Geology and soils, Greenhouse gases, Hazards and hazardous materials, Hydrology and water quality, Land use and planning, Mineral resources, Noise impact, Population and housing, Public services, Recreation, Transportation and traffic, Utilities & any other Mandatory findings of significance like real estate values. Upon the completion of the EIR, a thorough examination of the safety risks will be necessary as it was in the previous MacPhearson oil drilling project. A report like Bircher Report (safety study), which was done in relation to the MacPhearson project, will need to be done.

Its too complicated for the voters to rely on an EIR alone.  Its too complicated and does not address safety to the residents.  An EIR is meant to simply figure out how a project could get approved. Don't be surprised to see this EIR analyzed and separated by parts to make the environmental impacts appear smaller and insignificant to residents. It’s very important that the City Council get a report similar to the Bircher Report to fully understand the risks these kind of project present.

Hermosa Beach has been down this road before and completed an Environmental Impact Report for Macpherson Oil in the 1990's at this exact location. The City Council elected at that time showed great care and diligence in their decision making. They commissioned the Bircher Report and reviewed the EIR and concluded that it was unsafe and the air quality impact would have been too harmful on residents. Three City Council members Sam Edgerton, Julie Oakes and John Bowler unanimously agreed that to not proceed with oil drilling after reviewing all the findings. They felt that the safety risks were too great to allow the oil drilling project to proceed.

We need the EIR to be interpreted by professionals who will take into account the same safety issues our 1990 City Council had to. Our current council chooses not to heed this previous unanimous vote of their predecessors. It is unknown if they even read the prior EIR and related safety reports before agreeing to this settlement arrangement. The current city council viewed the outcome of a jury trail too risky and unlike our 1998 city council they put the citizens at risk, or in this case obviated the due diligence of a complicated project into a political vote where safety arguments and facts might get lost in the rhetoric..

Former City Manager Steve Burrell Unretires to Manage Oil EIR

Steve Burrell's Retirement Party Two Months Ago April 5, 2012

At the May 22, 2012 City Council Meeting, City Officials are set to approve a Professional Services Agreements with Ed Almanza & Associates and Stephen R. Burrell for consulting services to augment staff in processing land use entitlements and an Environmental Impact Report in connection with an oil drilling project.

Here is a letter to the City Council regarding this consulting agreement from long time resident Barbara Guild who beat oil drilling in 1957.  Barbara Guild has also done an extensive review on the agreement signed by Hermosa Beach and suggest that you read her oil agreement comments here.

Barbara Guild's Letter to City Council of Hermosa Beach

Dear Mayor Duclos, Councilman Fishman, Councilman Tucker, Councilman DiVirgilio, Councilman Bobko,

STOP and THINK before you go forward tonight and inappropriately approve not one, but two of the following items:  “Agreements for Consulting Services to Augment Staff in processing Land Use Entitlements and an Environmental Impact Report in Connection with an Oil Drilling Project.” DO NOT VOTE FOR THESE TWO AGREEMENTS!!! 

I have lived in Hermosa Beach for 64 years, and I am very interested in maintaining the flavor as well as the environment of our city. I actively defeated the Shell Oil Co. in their proposal to drill for oil in our tidelands in 1957. And I spoke to the Council, March13th, following the signing of the current agreement with E & B, where I stated that we are now starting with a clean slate and must realize this fact. 

The people of Hermosa Beach should be allowed to know which firms are bidding for the opportunity of preparing the necessary Environmental Impact Report. It should not be given to the first group that comes along. Allow those of us who are most interested in protecting our environment to come up with suggestions of who to engage. We have many environmental issues that need addressing, and a two-man group from Orange County, with no office on record, only a P. O. Box, should not be signed up without further consideration and public input.

The Settlement Agreement you signed, March 2, 2012, limits, to $50,000, the amount of money E & B will provide to reimburse the City for only these THREE items from (Paragraph 4.4 a):

1) The EIR,

2) The CEQA 

3) The Election to rescind the Oil Drilling Ban.

Former City Manager, Steve Burrell could earn $168,000 for each fiscal year (plus expenses), and the preliminary estimate for Almanza & Associates is $138,000. This would leave nothing to pay for the election, if it’s ever called.   Do you really think that E & B is going to pay for the contracts you might sign tonight? Please seriously consider your vote!

Yours sincerely, Barbara Guild

P.S. Here is Paragraph 4.4 of the March 2, 2012 Agreement the City made with E & B:

4.4 a. E & B’s Obligations Following Closing a. Reimburse City for the cost of preparation of an environmental impact report or supplemental environmental impact report (EIR) pursuant to the California Environmental Quality Act (CEQA) based on a Project description provided by E & B, should such an EIR be prepared and the cost of conducting a special election NOT TO EXCEED $50,000 as provided in Paragraph 4.6 (a). (Emphasis added). We are concerned why the city staff would need "assistance with processing the development application and other necessary entitlements" since this is a technical and straightforward procedure that shouldn't require a specialist consultant to accomplish. Unfortunately, Mr. Burrell placed a political cloud over his head by choosing to retire when he did. Had he stayed on longer, this contract would not be necessary. Although the city is not paying for his services, it has the appearance of double-dipping. Those opposing oil development will make hay of this which may very well distract from the serious issues of determining the safety of this project and proposed financial return to the city.

We would like to hear some details on why these people were chosen and what their qualifications and expectations are.  This comes from City Officials like Michael Divirgilio who is sounding the horn on more public transparency which I think is good.  Some questions I have for these individuals:

1) What are the details of this consulting agreement?

2)  How much are they getting paid and by Hermosa Beach?

3)  What is their history with the project, E&B, oil or lawsuit?

4)  What is their professional experience managing processes like this?

5)  Do Steve Burrell or Ed Almanza have any conflicts of interest?

6)  How will this facilitate the promise from City Council about making the EIR process public?

7)  Are any city residents involved in the EIR process?

8) Why are the we, the citizens, paying for this? Why isn't this cost being underwritten by the oil company? Or are we concerned that if they pay for it we won't get legitimate answers?

Please add your comments here.