Can a ballot initiative transform Richmond from a refinery town?

Sacramento Democrats may have abandoned plans to have the state’s biggest fossil fuel producers pay for their environmental and health impacts , but voters in the bayside city of Richmond, California, will still have the chance to do so this November.

An initiative placed on the Richmond ballot last month would tax the Chevron refinery, one of the largest in the state, $1 for each barrel of oil processed within city limits. While other local governments have attempted to make polluting industries pay more for the right to operate in their communities, boosters of the Richmond proposal say it offers a chance to transform a city defined by industry into something new.

“The ballot measure, in many ways, represents the start of a new chapter by bringing more resources into community control,” said Kerry Guerin, an attorney with Communities for a Better Environment, an environmental justice group.

Her organization, along with the Asian Pacific Environmental Network, spent “years organizing” community support for the per-barrel charge, which as a general tax requires a majority vote in a general election. The city attorney drafted it as an initiative, and the Richmond City Council voted last month to put it before voters.

The measure comes as lawmakers and community groups have begun pushing for more stringent taxation of industries posing environmental health hazards.

Last year, California Gov. Gavin Newsom proposed a windfall profits tax to hold large oil companies responsible for price gouging. Bills that would charge fossil fuel companies based on their greenhouse gas emissions have emerged in statehouses across the country . Carson, California, passed a municipal refinery tax in 2017 that launched the city into surplus by adding tens of millions of dollars to its annual budget.

In Richmond, the measure doesn’t earmark the estimated $90 million in revenue that the tax will generate for any specific purpose. But environmental justice community groups behind the proposal say the money could be spent to remediate industrial land and invest in clean water and air programs. That, advocates argue, will not just improve the health of Richmond residents, but allow the city to attract new businesses and gain some degree of financial independence from the refinery. Chevron’s tax liability represents about one-fifth of the city’s general fund.

In response, a Chevron employee and the recently formed Coalition for Richmond’s Future have sued the city for producing what they call an “aspirational” and “misleading” ballot measure.

The lawsuit, filed in early July, argues that the initiative’s language misleads voters into believing the tax money will be used for certain purposes when it is in fact just a general tax. The law firm representing the group, Nielsen Merksamer, has represented the California Independent Petroleum Association in other, recent political efforts.

Chevron called the tax proposal a “power grab” that could drive the company from the city. The company framed the measure as powered by a small group of advocates that would sever a long relationship between itself and Richmond.

It’s unclear, at present, how serious of a threat that is. The state has already taken ambitious steps to reduce its reliance on fossil fuels and aims to achieve 100 percent clean energy by 2045, in part by phasing out oil extraction. Those long-term headwinds likely pose more of an existential threat to Chevron than a local tax does.

“The City of Richmond is playing chicken with the region’s economic future,” said company spokesperson Ross Allen in a statement. “We urge the city to avoid risking the viability of the city’s biggest taxpayer.”

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