The $1.8 million oil spill debacle

.

12/6/11 – On November 8, 2011, the Banning City Council unanimously approved a 1.8 million dollar oil spill cleanup bill – more than three times the original estimate of $ 500,000. But not a single Council member asks even one question !  Could there be more to the spill than meets the eye ? Let’s take a look ….

.

WHAT HAPPENED ?

According to officials of the Banning Police Department and the City of Banning , on or about July 25, 2011, roughly 300 gallons of used motor oil, contained in oil barrels, were spilled on an unoccupied property at 553 E. Ramsey Street.

Banning Police Sergeant Alex Diaz confirmed that a suspect has been identified and has “practically admitted” that he tipped over the barrels when he was drunk. The full oil barrels seemed to have originated from the property next door, where, according to City officials, automotive work was conducted without permit. The District Attorney is currently handling the matter.

According to the City Manager, the oil then made its way via the storm drain system, traveling just under a mile all the way to Interstate 10.

The very next day, at a regularly scheduled City Council meeting, the Banning City Council declares an emergency because of the spill. A request from City Manager Andy Takata for $ 500,000 to cover the cleanup cost is immediately approved (Resolutions 2011-69 and 70).

.

The entire oil spill cleanup takes 9 days and is performed by HCI, a Corona, CA based firm. During this time, other agencies get involved. According to a City official, the California Department of Fish and Game directed the contractor to wash out the contaminated areas twice, once with cold water and once with hot. This doubled the trucking and disposal expenses for these liquids.

After a 9 day cleanup, HCI bills the City of Banning a total of $ 1,809,791 .

.

.

.

CITY RENEWS CONTRACT WITH CLEANUP FIRM HCI TWO WEEKS BEFORE THE OIL SPILL

Two weeks before the oil spill occurs, the City renews a contract for “Emergency Spill Cleanup Services” with cleanup firm HCI– to be performed on a “as needed basis .

A copy of this contract can be found here. The contract is not to exceed $ 25,000 per year, (Exhibit “C”). Having an established business relationship with HCI, the City decides to use the firm for the subsequent $ 1.8 million oil spill cleanup.

.

.

$ 1.8 M CLEANUP WORK CONDUCTED WITHOUT BID AND WITHOUT CONTRACT

As of the day of this article, no contract between the City and HCI has been executed that would cover the $ 1.8 million cleanup. However, to patch things up, the City is currently “custom tailoring” a contract after the fact. Needless to say, no other firm was allowed to submit a competitive bid.

There is no document that establishes the conditions under which HCI was hired to cleanup the spill. On July 27, HCI prepared  a “Specific Site Work Plan” (view), however, the document does not address the issue of cost. Was this oil spill cleanup an undocumented “free for all” ?

.

.

MOST EXPENSIVE OIL CLEANUP (PER TON) IN WORLD HISTORY ?

Motor oil, new or used, has a specific weight of 7.3 pounds per gallon. Therefore,  300 gallons equal 2,190 pounds or roughly one metric ton of oil. We are told that it took over $ 1.8 million to cleanup this 1 ton of oil.

Is this price tag within the ballpark of other oil spill cleanup costs ? To answer this question, reference should be made to a study published in 1999 during the “International Oil Spill Conference” entitled  “ Estimating Cleanup Costs for Oil Spills” (view document). The study makes reference to a database compiled by the “Oil Spill Intelligence Report” (website), containing data of roughly 8,600 oil spills worldwide.

The study reaches the conclusion that oil spill cleanups have a wide range, with the most expensive cleanups occurring in remote areas like Alaska, (Exxon Valdez). The study shows a cost of  $ 73,156 as being the highest average cost per ton worldwide. The cleanup cost in Banning exceeds this number by 2,400 % – or, stated differently, is 24 times as high !  This raises the question : is the contractor overcharging ?

.

INDEPENDENT CONSULTANTS QUESTION OVER $ 1.2 MILLION OF CLEANUP BILL

In a commendable effort to verify the accuracy of contractor HCI’s billing, the City of Banning hires consulting firm Erler & Kalinowski (EKI) to go over the $ 1.8 million cleanup bill . Cost of their review : $ 4,500.

In their report (view), EKI questions over $1.2 million of HCI’s billing, calling it “inconsistent”. They recommend that the amount in question should not be paid until EKI can verify it through further detailed itemization and clarification to be provided by the contractor, HCI.

But the City of Banning does not follow these recommendations. We were told that on December 2, 2011, the City  paid the entire $ $1.8 million bill anyway.

.

CITY COUNCIL SPENDS JUST 4 MINUTES TO APPROVE THE $ 1.8 MILLION CLEANUP PAYMENT

On November 8, the Council spends 10 minutes on retiring a cute police dog and a full 20 minutes on a large boat that was physically carried into the Council chambers. Yet only 4 minutes are spent on the oil spill.

Keep in mind that the $ 1.8 million cleanup bill constitutes by far the largest unbudgeted expenditure in Banning’s recent history : it effectively cuts the City’s reserves in half. But in regular session, on November 8, 2011 – in just 4 minutes – the City Council approves the expenditure without asking any questions, without discussion and without imposing conditions. Why ?

Can we, the taxpayers, fork up $ 1.8 million in just 4 minutes ? No, we can’t. But apparently 4 minutes is all the time it takes for the Banning City council to spend this amount.

.

Here are the highlights of the session :

.

• Staff report and vote combined take just 4 minutes
• No comprehensive explanation is given as to why the cost for cleanup has now more than tripled
• City manager Andy Takata states that the Consultants deem the bill “accurate”, when in reality the same Consultants question the vast majority of the bill (view report and watch video below)
• There is no discussion among the council
• No questions are asked by any member of the council
• City manager Takata recommends payment in full  – against the clear advice of consulting firm EKI

Please watch the following 4 minute video. Banning City manager Andy Takata – seemingly uncomfortable –  states that he wants to “get it over with”. Throughout this uncanny session, the silence of all Council members is truly deafening !

.

.

SECRET COMMUNICATION BETWEEN CITY MANAGER AND COUNCIL

An email sent by City manager Andy Takata’s office indicates that Takata already knew in early August 2011 that the $ 500,000 he had requested for the cleanup would not be sufficient. This fact, however, was not revealed to the public until November 8 – over 3 months later –  when it was addressed in public session.

In the August 3, 2011 email (view),  Takata’s office informs all five City Council members that the cost is “expected to be in the $ 750,000 to 1,000,000 range.”

For City Manager Andy Takata to engage in any such email communication with the Council members raises great concern. His email may have violated the Ralph M. Brown Act, as it could constitute an unlawful serial meeting. Any staff communication with the entire council needs to either be in form of an agenda package and/or within public or closed session (staff report).

Why does the City manager go to the extend of engaging in secret communication with the Council ? Was there a secret deal being struck behind the scenes ? Was there a financial interest ?  Why does the Council have a need to know the information, yet the public is purposely kept in the dark ? This definitely explains why there was no discussion by the council in public session on November 8. What else was secretly communicated ?

This example goes to show how public sessions of the Banning City Council have become a total farce and are nothing more than a “dog and pony show”.

Shame on Mayor Barbara Hanna as well as Council members Don Robinson, Bob Botts, John Machisic and Debbie Franklin for taking part in such secrecy !

.

CONCLUSION

The debacle of Banning’s $ 1.8 million oil spill raises more questions than it provides answers.

With there still not being a contract with HCI, why has the bill already been paid ? And with Consultants questioning the majority of the bill as “inconsistent”, why was it paid in full ? Why does City Manager Takata fail to tell the public about the Consultants grave concerns ? Why do both the City Manager and the entire Council appear so eager to pay ?  Why is  information secretly exchanged behind the scenes ? Does something smells rotten in Banning ?

With the cleanup cost seemingly breaking all historic records, did some people get very rich on the public trough in Banning ?

If you would like to comment or discuss this – or any other – article,  please visit us on FACEBOOK