(Please excuse my typos below)
3) Request for clarification as to where/how the City is specifically keep track of the accumulating city expenditures which are not being reimbursed by E&B Natural Resources as related to the likely 2014 oil ballot measure.
When the settlement agreement between the parties was announced in March of 2012, it was indicated that E&B Natural Resources would be paying essentially all of the costs leading to an election for the purposed of determining if the people of Hermosa Beach would lift the City's ban on oil drilling.
Later it was announced that city staff time utilized for all additional work related to preparation for an election would be reimbursed by E&B at an amount equal to 10% of the cost of the EIR preparation. And further it was indicated that E&B would cover the costs of obtaining the EIR, and would pay not more than $50,000 of the actual election costs.
Since then the Council has approved hiring (at the City expense) consultants to do such things as the City's own "Economic Study", and for a "Community Dialog" process (some or much of which "Community Dialogue" will be oil drilling related according to the RFP for that consultant.)
There appears to be a significant amount of staff time being expended daily on various aspects of oil drilling. Thus, if the EIR preparation costs amounted to $800,000 in total, that would mean E&B would only be reimbursing the City $80,000 for all of its cots for consultants, meetings, reports, attorney fees, staff time and on and on for the extraneous activities leading to the oil drilling election.
The people were essentially told by the Council that the oil litigation was over and that their only costs going forward would be one of the following:
- If the electorate approved oil drilling at an election then the City's obligation to E&B would be $3.5M, plus the City's own costs ongoing attorney and staff time indefinitely, plus essentially the giving over to E&B for their use of a parcel of City Yard land presently worth $11M or more. In other words an approximate total city burden of $14.5M plus city expenditures of perhaps $500,000 indefinitely.
- However, if the electorate maintains the ban on oil drilling they'd simply owe E&B $17.5M and that amount could be paid over a period of years, ie. 30 years at "mutually agreed terms".
All need to be reminded that the settlement agreement requires an extremely valuable 1.3 acre city parcel, with a present value of $11M or more if properly zoned, to be handed over gratis to E&B, along with $3.5M cash, if the voters approve lifting the ban on oil drilling.
Further, all need to be reminded that the city and the school district are to be receiving relatively poor share of the hypothetical oil revenue (it should be not less than 50% in total of direct oil and gas sales revenue). This unfortunate fact indicates that past city councils really did give away the store to Macpherson. Why they so stupidly did that is past history.
3-a) The question here is, how is the city keeping track of its expenses month by month, and where can the public and the Council view and be aware of the ongoing escalating expenses in a manner, ie via a spreadsheet tabulation? Such tabulation should clearly indicate the ongoing costs being reimbursed by E&B from their deposits fund, along with the ongoing costs being reimbursed by E&B from their deposits fund, along with the ongoing city expenditures not being reimbursed by E&B from their deposits fund.
See Item 4 Brown Act
See Item 4 Brown Act
