Richmond, CA Coal Export Terminal, Oakland Harbor Port Terminal
By Stan Holmes, Utah Chapter
Oakland, California’s decision to block coal exports has triggered questions about the status of $53 million Utah has sitting in a Throughput Infrastructure Fund (TIF) earmarked for a West Coast coal export terminal. Utah lawmakers have wasted no time trying to access those funds for other projects benefitting the state's fossil fuel industry. Fortunately, the initial legislative attempt failed when it sparked strong disagreements pitting oil and gas interests against coal producers.
First, some background. The $53 million was originally federal Mineral Lease Act (MLA) royalty money intended to address social, economic, and public finance impacts that rural communities experience due to oil, gas, and coal mining operations on nearby federal lands. Concerned that giving so much MLA money back to the fossil fuel industry directly might draw federal investigators, Utah legislators in 2016 "laundered" the money into a special TIF account dedicated to coal exports and specifically meant for investment in a new coal export facility in Oakland, CA.
During the first week of February 2022, following a protracted legal battle, the City of Oakland achieved a settlement framework with Utah-backed port developers that would prohibit the transport and shipment of coal through the new bulk export facility. This follows a recent agreement by Richmond, CA to close its coal export terminal in 2026. Utah's continued role as a significant coal exporter appears to be growing bleaker by the days.
What, then, will the State do with the $53 million? Some hope it will be used for road and rail links to the deep water port in Ensenada, Mexico, where Utah has an existing export agreement. Legislators, like Senator Harper, proposed legislation in the 2022 State General Legisialtive Session (S.B. 51) that would have allowed it to fund fossil fuel projects like the Book Cliffs Highway to facilitate oil export traffic.
David Bennett of Utah Citizens Advocating Renewable Energy (UCARE) asks "What about sustainable economic development in rural Utah's coal country? How about spending the money on non-hydrocarbon enterprises there? And re-training programs for workers stuck with the declining coal industry. Perhaps better medical facilities."
Back to Utah legislative reality: Senate Bill 51, co-sponsored by Senator Wayne Harper and Rep. Kay Christofferson during the 2022 State General Legisialtive Session, originally focused on registration and emissions of vintage cars. But at the insistence of Senator Ron Winterton, SB.51 sponsors inserted a provision appropriating $20 million of the TIF for "a road project primarily used to transport hydrocarbons." The intended road was not specified. Early speculation pointed to the Book Cliffs Highway (a.k.a. Eastern Utah Regional Connection Project).
At the Seven County Infrastructure Coalition's (SCIC) Feb.18 meeting at the State Capitol, though, it became apparent that the hydrocarbon road in question runs through Nine Mile Canyon and requires upgrades to handle additional trucks carrying Uinta Basin waxy crude oil to the rail hub near Price.
'Wait just a minute' enjoined SCIC's coal county commissioners, in response to the prospect of diverting TIF coal export money to an oil and gas transportation project. How could it be that Senator Winterton, an oil and gas guy, would go after TIF money without consultation? Summoned from legislative activities next door, Winterton told SCIC commissioners that he'd acted as directed by "leadership." He said the hydrocarbon road provision would be pulled from SB.51...the vintage car bill...and that he'd find another funding source.
Note: As this issue of the Utah Sierran newsletter is being completed, there's still time for fossil fuel advocates to drill into the $53 million. Facilitating the growth of these projects and investing in transportation infrastructure to support them would exacerbate environmental and public health concerns that the state is already facing. Click here to sign up for our legislative opt in to receive a recap on the 2022 General Legislative session in Utah.