Richmond Oil Refining Tax on Chevron, a Major Polluter, Moves Closer to Ballot

The Richmond City Council voted unanimously Tuesday night to direct the city attorney to prepare a ballot measure that would tax oil refining, putting the city one step closer to a tax on the Chevron Refinery sought by environmental justice groups.

The tax would help address an anticipated $34 million budget shortfall for the 2024–25 fiscal year, according to Mayor Eduardo Martinez and Vice Mayor Claudia Jimenez, who cited the harm done by oil refining to the environment and public health in introducing the measure.

Chevron, Richmond’s largest employer and taxpayer, netted $21.3 billion in profits last year and paid $45.9 million in taxes to Richmond in the 2022–23 fiscal year, representing more than 15% of the city’s revenues. Annual revenue from a refining tax could approach $100 million, according to Kerry Guerin, an attorney for Communities for a Better Environment Action, which initially proposed the idea along with the Asian Pacific Environmental Network Action.

“We support policies that encourage business investment and seek to create a better quality of life for Richmond residents,” Chevron wrote in a statement sent by company spokesperson Caitlin Powell. “That said, we believe the proposed refining tax is the wrong approach to do that.”

Chevron called the tax “a hasty proposal, brought forward by one-sided interests” and said it would hinder the company’s ability to improve its facility to better provide clean energy, among other things.

Kevin Slagle, a spokesperson for California’s main oil industry group, the Western States Petroleum Association, said oil refining is already more expensive in California than anywhere else in the U.S.

“Any additional local taxes or regulatory programs could make operations more challenging and expensive, which could lead to higher costs at the pump for all,” Slagle said in an email.

During Tuesday night’s meeting, Jimenez pushed back on the oil industry assertions and said the new tax revenue would not only fund city operations but also help build green businesses to replace fossil fuel production.

“What we are proposing is not going to break things or just to make them leave,” she said. “What we are proposing is to make sure that we continue to advocate for such a big business with billions of dollars to pay their fair share to Richmond.”

Oil refining is the largest single source of pollution in Richmond, with harmful health effects. Emissions of particulate matter from the Chevron Refinery are responsible for 5 to 11 premature deaths in Richmond each year, according to estimations by the Bay Area Air Quality Management District. The air district also cites those emissions as contributing to cardiovascular disease, respiratory illnesses and asthma.

Asthma rates for Richmond residents are higher than 90% of other Californians, according to state data.

“I myself suffer from asthma. My son, who’s 9 years old, is a two-time cancer survivor,” said Sandy Saeteurn, a political director with the Asian Pacific Environmental Network Action and a longtime Richmond resident.

She said the Chevron Refinery is “continuing to pollute our air, our environment, our health. And yet, we are not seeing them as good neighbors. We want to make sure that they’re investing in our city, investing in our residents and the future of our community.”

Dr. Amanda Millstein, a primary care pediatrician who saw patients for years in Richmond after working in other Bay Area cities, said many parents in the city expect that their children will develop asthma – and added that “they are not wrong.”

“I have lost track of the number of families who have asked me at the initial visit with their 2- or 3-day-old baby, ‘Doctor, does my baby have asthma?’ Or ‘How will I know when my baby has asthma?’” Millstein said.

Most of the dozens of people who spoke during public comment in Tuesday’s city council meeting favored the tax.

Longtime Richmond resident Raphael Castro recalled witnessing the 2012 Chevron Refinery fire and sealing his windows with wet towels to protect his younger sister from breathing the air “because, in North Richmond, we have a higher risk of our children getting asthma,” he said.

Timothy Jefferies, a representative of the International Brotherhood of Boilermakers, many of whom work in refineries, was more wary.

“We are not against clean air,” Jefferies said. But he cautioned the council to take stock of the good-paying jobs provided by the refinery and “all the indirect jobs, all the indirect economics that this city enjoys because of those jobs.”

Richmond voters passed a tax on refineries in 2008, but the measure was challenged in court and struck down in 2009.

Community groups backing this renewed effort said the city can resolve those legal issues this time around. The ballot measure sought by the City Council would go before voters in November.