You probably didn’t know that the citizens of San Francisco own 800 acres of oil-producing lands smack in the middle of Chevron’s Kern River oil field.
Yup, some rich dude named Alfred Furhman left it to the city when he died in 1941.
Per his will, royalties from oil sales off that land have been split 50-50 between the San Francisco Public Library (to buy books on economic and political subjects) and for the “further adornment” of Golden Gate Park.
What that’s meant in actual cash has been as much as $1.08 million in 2007 down to $312,629 last year.
The average has been about $859,500 a year for the last few years.
I know San Francisco flies a bit higher than Bakersfield, but that’s still nothing to sneeze at.
Yet, sneeze they did.
The San Francisco Board of Supervisors on Nov. 15 unanimously approved a first reading of a an ordinance prohibiting fossil fuel production on city-owned land.
A second reading of the ordinance must be approved Nov. 29 before it’s sent to the mayor, who’s expected to happily sign it into law.
The lease with Chevron expires in 2020 and after that, no more oil production will be allowed on that patch of land per the new ordinance.
OK, that wouldn’t have been my move had the land been left to me.
But I guess it’s nice to see San Francisco put its money where its mouth is to back up its greener-than-thou attitude.
In “debating” the ordinance, which must have been more like an echo chamber, SF’s bureaucrats assured supervisors the city wouldn’t lose out on any money.
In fact, they said, the city stands to make even more money ($1,000 per acre) by leasing it to a private solar company.
I was reading all this in a San Francisco Examiner article, but I could just imagine the sound of angels singing as they all paused to bask in the glow of their own environmental halos.
First, there are 69 active wells on San Francisco's land.
Cost to properly abandon those wells, which San Francisco would need to do, is around $6.2 million.
Chevron would have to clear out the above-ground infrastructure according to section 31 of the lease. But what's in the ground belongs to San Francisco once the lease is allowed to terminate.
I'm sure a high-priced city attorney would try to find a way out of that, but that's another hit to San Francisco's coffers.
Moving on, there also isn’t an electricity substation or major transmission line near the city’s 800 acres, so where is all this alleged solar power going to go?
San Francisco’s real estate director, John Updike, mentioned that fact back in March when this first came up, according to an Examiner article. But by the first vote in October, that issue seems to have melted away.
Then there’s the fact that the city’s 800 acres is waaaaaay back in the northeast corner of the Kern River oil field accessed by a single track, pock marked road owned by Chevron.
Assuming Chevron allowed San Francisco to use its road, it wouldn't take many tractor trailer rigs bringing in panels for a large solar farm before that road would be torn to shreds.
The city’s acreage also includes land it leases for cattle grazing. Land that is rippling with steep brown hills.
No way could you build a road, much less a solar farm, on those hills without major cut and fill.
As I pondered the topographic difficulties San Francisco's plans presented, a tarantula made it’s fuzzy way across the road.
Oh, yeah, the area is crawling with endangered species. So, there's that.
All of which made me wonder how much analysis was actually done before city officials decided to cut off this money spigot.
But more important, what’s the impact to Kern County?
I called Kern County Planning Director Lorelei Oviatt, who has extensive experience permitting solar farms as Kern has become an alternative energy leader in California (along with still being the leader of regular energy production).
She hadn’t heard of San Francisco’s plans and quickly reached out to officials up there.
“I wanted to make sure they knew how complicated this is. The county has a number of mitigation measures,” she said.
Those mitigation measures were created because even privately owned solar farms don’t have to pay property taxes. And government entities are exempt from property taxes as well. (Looks like the only non-freeloader is Chevron, which currently pays the county about $45,000 a year.)
Luckily, Oviatt has figured out ways to “coordinate” with other government entities that have built massive solar and wind farms in eastern Kern County.
By coordinate, that means Kern has found ways to make up for the lack of property taxes through fees and other payments slapped on new solar farms.
So, Oviatt wanted to give our friends in San Francisco a heads-up on what to expect as they move forward.
Hey, it’s their land.
If San Francisco thinks it can make better, cleaner money going solar, more power to them. (Heh, heh, get it?)
But if I ran that library and park, I’d be watching this deal very closely.