Governor Arnold "Chevron" Schwarzeneggers stripes -conflict of interest alert:
AP Exclusive: Chevron gave big to governor, played key role in reorganization plan
TOM CHORNEAU, Associated Press Writer
Thursday, September 2, 2004
sfgate.com
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(09-02) 12:16 PDT SACRAMENTO (AP) --
Gov. Arnold Schwarzenegger's ambitious plan to reorganize almost every aspect of state government was influenced significantly by the oil and gas giant ChevronTexaco, which managed to shape such key recommendations as the removal of restrictions on oil refineries.
Many corporations and interest groups participated in the governor's reform plan -- known as the California Performance Review -- but state records and interviews with the participants show Chevron enjoyed immense success in influencing the report through its array of lobbyists, attorneys and trade organizations.
And few corporations have spent so much political cash on the governor, either. Since Schwarzenegger's election last October, the San Ramon company has contributed more than $200,000 to his committees and $500,000 to the California Republican Party.
Chevron is one of about 20 companies that paid to send the governor and his staff to this week's Republican National Convention in New York. On Wednesday, Schwarzenegger attended a closed-door meeting in New York with representatives of those companies, including Chevron. And just three weeks after the governor's office released the 2,700-page reorganization report, the company gave $100,000 to a Schwarzenegger-controlled political fund.
Environmental watchdogs and local agencies that regulate some of Chevron's operations complain that they had no such access, and that their counterproposals appear nowhere in the massive report.
Disclosure of Chevron's determined role in what many believe is the administration's most important political reform effort contrasts sharply with statements he made during last year's election campaign and afterward in which he promised to sweep out a corrupt system where "contributions go in, the favors go out."
Although the governor's senior aides helped organize and oversee the reorganization effort, a spokeswoman for Schwarzenegger said the review staff, not the governor's office, was responsible for the report.
Ashley Snee, the governor's deputy press secretary, said it was premature to assume any of the recommendations will be adopted and that those who are unhappy with parts of the report can comment at a series of statewide hearings on the proposal.
Proposals that would benefit Chevron are peppered throughout the four-volume report. They include:
* Streamlining the permit process for the construction of new oil refineries and the expansion of existing ones. Chevron, which owns two of the state's largest refineries in Richmond and El Segundo, wanted the state's help in revising existing laws so local government officials would be required to make decisions more quickly on construction permits at refineries.
* Streamlining the activities of the San Francisco Bay Conservation and Development Commission. That agency, which issues permits for dredging and sand mining in the Bay Area, oversees activities related to Chevron's interests in the Bay Area.
* Reorganizing the regulatory process for picking the locations for refineries, tank farms, liquefied natural gas and other energy facilities. Chevron has two proposals to build liquefied natural gas (LNG) facilities in Southern California and the Mexican state of Baja California.
Chevron's considerable influence on the CPR report may taint the whole review because the study was presented to the public as an objective and authoritative analysis of how to fix state government, said Mark Petracca, a University of California, Irvine political scientist.
"This is good old fashioned interest-group politics," Petracca said. "Powerful people who have money can hire powerful people and use occasions like this report to set the agenda for policy beneficial to those interests."
Chevron's operations have drawn steady and critical scrutiny from state and federal regulators, including a settlement last October of a lawsuit with the U.S. Justice Department that required the company to install $275 million in air pollution equipment and pay $3.5 million in civil penalties.
Company officials said they were just doing their jobs through their vigorous participation in the CPR process, which included meeting with senior aides to the governor.
"This is what we are here for," said Jack Coffey, Chevron's general manager over state government relations, from New York where he was attending the Republican convention.
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