I ran across the following article in the RPA Newsletter:
Foreign Trade Zone for Chevron in Richmond?
Most people don't know that Chevron has received considerable tax and other advantages by getting its site declared a Foreign Trade Zone by the San Francisco Port Commission since 1998. This status is coming up for renewal on July 14.
This situation raises many questions:
1. Why does the SF Port Commission determine major economic decisions for six other Bay Counties, apparently without consulting local communities affected?
2. How much public money (Federal, State, and Local) is effectively transferred to local refineries by this designation?
3. Should the City of Richmond and other entities intervene in the July 14 S.F. Port Commission meeting that will consider the renewal of the Chevron FTZ status?
I have raised these issues with City staff and with our county, state, and federal representatives: John Gioia, Tony Thurmond, Loni Hancock, and Mark DeSaulnier.
At the very least the communities that are affected should be part of the negotiations that grant huge benefits to Chevron and other refineries and also encourage them to boost production at these locations.
City Manager Bill Lindsay has stated that he will be researching this issue and will get back with me next week. I will update the community as soon as I have more information.
-- Councilmember Gayle McLaughlin
See http://enforcement.trade.gov/ftzpage/ftznew/19cfr146.html. Subpart H. The article http://www.naftz.org/wp-content/uploads/2012/10/Why_Zones_are_Important_to_the_Oil_Refining_Business.pdf seems to be a pretty accurate description of why refineries use the trade zones.
Although Chevron’s foreign trade zone doesn’t appear to have any adverse impact on Richmond and apparently saves Chevron some money, it raises questions about why the trade zone was created through the port director of San Francisco while the regulations state that the nearest port director should make the application. Richmond has its own port director.