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Updates on proposed Hermosa Beach oil project

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The Hermosa Beach City Council Tuesday discussed developments to the ongoing proposed oil drilling project, ranging from when the issue would go on the ballot to the city hiring an attorney with expertise in oil proceedings.


The City Development Agreement subcommittee, which consists of Mayor Michael DiVirgilio, Councilman Hany Fangary, City Manager Tom Bakaly and City Attorney Michael Jenkins, met for the first time with representatives from E&B Natural Resources on May 6. City staff gave a report of the closed session meeting on Tuesday. E&B raised the issue of whether the drilling project’s Environmental Impact Report will be ready in time for the issue to go on the November ballot. The city maintains that the EIR is on track to be certified in time for a 2014 election.

E&B representatives also asserted that the settlement agreement gives the company the right to dictate the timing of the election. Jenkins said that nothing prevents the city from proceeding with a November election. Bakaly said that E&B has not requested that the city postpone the election. At the State of the City address earlier this month, DiVirgilio said that the city’s top priority was getting the oil issue on the November ballot.


At Tuesday’s council meeting, Bakaly said that the city is potentially days away from hiring an attorney from the Los Angeles area who has expertise in oil issues. The attorney would advise the city council on the Development Agreement and would likely stay on until early June, when the city hopes to be done with the document. The city council previously authorized Bakaly to execute an agreement of up to $20,000 once an attorney is selected.


Last month, Assemblyman Al Muratsuchi (D-Torrance) introduced a bill that would loan the city of Hermosa Beach $17.5 million from the State Tidelands Funds. In the event that the ban on oil drilling is maintained, the city would have to pay back E&B Natural Resources a loan of $17.5 million that the company gave the city to settle a lawsuit with Macpherson Oil. Supporters of Assembly Bill 2711 can now sign a petition online endorsing the proposed loan at Muratsuchi’s official website at asmdc.org/members/a66.


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