As debate over the proposed oil recovery project in Hermosa Beach ramps up, the citizens who stand against the project have adopted the battle cry “Keep Hermosa Hermosa”, voicing concern that this plan will singlehandedly tear the fabric of the community apart. Although their reservations are understandable, as with any debate, it is important to weigh the pros and cons from both sides. Upon conducting a full risk/reward analysis of the proposed project, every voter must independently decide for themselves, will turning the project down really help “Keep Hermosa Hermosa”?
Take one look at Hermosa Beach and one could easily surmise why the plan has been opposed by residents at first glance. Warm weather, sandy beaches, rows of palm trees, and a surfer-town vibe make Hermosa Beach a picture perfect town to live in. One mention of “oil” and everyone envisions off-shore platforms, spills, explosions, and greedy corporations. The residents have a point: all of the above would certainly prevent Hermosa from “being Hermosa”. While recent disasters such as BP Horizon oil rig explosion in the Gulf Coast are very fresh on citizen’s minds, a comprehensive review of the proposed project plan reveals that in fact, there is a lot of due diligence being done to ensure safety and minimal environmental impact from the Hermosa Beach Oil Recovery Project.
The company behind the recovery project, E&B Natural Resources, is a small, California-based, family-owned company with operations in only five states. They understand the importance of preserving the charm of the community and have taken several steps to reflect that in their plan. For example, E&B will be using the environmentally-friendly directional drilling technique to recover oil. In short, wells are drilled from a single on-shore location diagonally to reach the oil fields underwater. This requires no off-shore platforms ruining the coastal views and significantly decreases the chances of spills and other problems. It’s safe to say people understand that the City of Hermosa is pursuing this project for economic benefit, but the extent of that benefit goes unnoticed. According to a recent study by the Berkeley Research Group, Hermosa Beach stands to earn $519 million in revenue from the oil extracted. Some residents have expressed concern over the amount of money that would be restricted to shore/coastal use since much of the oil will come from the Tidelands. While it’s true that the State Lands Commission (SLC) allocates money made from the Tidelands to specific uses, most of the revenue ($285 million) would go to Hermosa Beach’s general fund, as a fee for use of the City’s property. . While $234 million would be restricted, it’s important to note that 37.5% ($87,750,000) of it is unrestricted and goes into the general fund by virtue of an agreement approved by the SLC.
Just because the Tideland royalties are “restricted”, it doesn’t mean Hermosa will not benefit. The “specific uses” mentioned earlier regarding the Tidelands oil royalties encompass a wide variety projects aimed at the betterment of the community. The SLC’s public trust policy requires funds derived from the Tidelands be used for projects that are “water dependent or related, and include commerce, fisheries and navigation, environmental preservation and recreation”. In the past, the SLC has approved Tidelands fund use for projects like street and sidewalk improvement, beautification projects, carbon footprint reduction, and energy efficiency efforts.
The opponents to the plan are primarily concerned that the project is not in the best interests of “Keeping Hermosa Hermosa”, but in reality it is money itself that keeps Hermosa Hermosa. Funds like these could help keep public facilities up and running, keep schools up-to-date with the latest learning materials and technology, keep potholes filled, allow for new trees to be planted, ensure that police/firefighter/teacher salaries are paid, and allow for community events to continue to happen. Without revenue, everything that residents love about Hermosa Beach comes to an end. Another benefit of the proposed project would be the creation of jobs. According to Sperling’s Best Places, a renowned analyst firm specializing in urban data, Hermosa Beach experienced -0.71% job growth over the last 12 months. An influx of economic stimulus in the community could potentially help Hermosa on the plus side again.
Recently, Hermosa Beach residents have been voicing their concern over the fact that the city is having trouble taking care of basic services. A 20-year Hermosa resident wrote to a local news outlet that he was, “astounded that our city cannot seem to manage basic services that cities typically provide: street repaving, maintaining street lights and signals, street repair, etc. For example, for many months the city owned trash containers located on what Councilman Peter Tucker calls “The Rodeo Drive of the South Bay” (Pier Avenue) have been rusting away.” The Hermosa Beach described by this longtime resident hardly fits the description given by those who are desperately trying to “keep Hermosa Hermosa”. If revenue from the oil project is unneeded, then it begs the question: why can’t these issues be solved?
The answer to the question is simple: the city lacks the revenue to fund these projects. Hermosa has been dealing with deferred maintenance projects for years now. For example, the Hermosa Beach Community Center has a leaking roof, faulty windows and a basketball court wing that is desperately in need of renovations. The Fire Department building, which is over 50 years old, is also in need of repairs and upgrades. A recently proposed sewer renovation plan presented to city council, which requires $13 million, can only add $700,000 towards applying for a bond to fund the project. Since the sewers cannot be fixed, the streets above them cannot be fixed as well. To date, Hermosa has gone an entire year without street improvements. Lastly, Hermosa has seen a 13% staff reduction over the last two years, including positions within the Police and Fire Department. It’s the lack of revenue that has caused the city to fall behind on issues like these. Hermosa is in desperate need of a new revenue stream and the oil project can provide it in spades.
While environmental and safety concerns are paramount with this project, and rightfully so, voters will have an opportunity to review the EIR (Environmental Impact Report) recently commissioned by the city that is in the process of being completed. If it is verified that the risks of the proposed project are low and the potential gains are high, every voting citizen of Hermosa Beach needs to honestly ask themselves the question: Will denying the city the chance to make half a billion dollars really help “Keep Hermosa Hermosa”?