City Attorney to Urge Oil Pipeline Settlement

The Los Angeles city attorney’s office is expected today to recommend that the City Council accept a settlement allowing construction of a controversial pipeline that would pump hot crude oil from Kern County through the San Fernando Valley to refineries in Wilmington.

The council will have its legal back against the wall when it considers the settlement because a Superior Court ruling in January gave owners of the Pacific Pipeline eminent domain powers to build the line under city streets.

City Hall sources say the city’s chief legislative analyst’s office and city attorney’s office both support a settlement to put an end to the seven-year battle that the city has been waging against the pipeline.

With that kind of support for a settlement, the council will be hard-pressed to continue the lengthy legal war.

“They would be tilting at windmills,” said one official involved in the settlement discussions.

The only legal challenge the city has left is a pending lawsuit against the U.S. Forest Service that would attempt to halt the pipeline by prohibiting it from running through the Angeles National Forest.

Pacific Pipeline has won several rounds in court and still has a $300-million antitrust suit pending against the city for trying to block the project.

Under the proposed settlement agreement, both sides would drop the remaining lawsuits, allowing pipeline construction to begin under city streets almost immediately.

Sources say Pacific Pipeline would agree to pay for 100 computers for area high schools along the route. The pipeline would also allow the city to place fiber optic lines along the route to improve the Police Department’s 911 system, sources say.

As proposed, the $170-million line would carry 130,000 barrels of oil per day to Los Angeles refineries.

The 20-inch diameter line--about the size of a basketball rim--would enter the city of Los Angeles in Sylmar and follow the Southern Pacific right of way through San Fernando, Burbank and Glendale before cutting through the heart of the city to Wilmington. Along the route, the line would run beneath 9 1/2 miles of city streets in Los Angeles.

Councilmen Richard Alarcon and Mike Hernandez, who represent the mostly working-class Latino communities where the line would run, have been the most vocal opponents, saying the line puts their constituents at risk of leaks and explosions.

But they also have had to oppose labor groups, which are anxious to benefit from the estimated $50-million construction payroll.

In an interview Tuesday, Alarcon said he still opposes the line but realizes that the city may have no option but to eventually settle.

“The Superior Court has clearly put us in a difficult position with regard to what options we have remaining,” he said. “I am not friendly to the notion of a settlement, but I have to recognize from a legal perspective that the odds are against us.”

Hernandez, however, showed no sign of softening his stance.

“We will fight to the end,” said Morrie Goldman, a Hernandez spokesman.

Los Angeles has been the lone city to continue fighting the project. Southern California Edison, which is working on a competing pipeline, has also joined the city in challenging the Pacific Pipeline.

Because the city rejected a franchise agreement to allow Pacific Pipeline to run its line beneath city streets, it lost authority to impose any conditions to lessen the environmental impact. The company is required to meet only the minimum conditions imposed by the state.

Only a settlement would allow the city to request amenities and additional environmental mitigation measures.

Opponents of the line have repeatedly argued that the project increases the risk of a rupture or oil leak. Alarcon and others have also expressed fear that a rupture near the city’s main aqueducts and reservoir near Sylmar could contaminate 75% of the city’s water.

But proponents argue that the line will use state-of-the-art technology and will reduce smog and traffic by replacing oil-carrying trucks, trains and ships.

Pacific Pipeline System is owned by Anschutz Corp., headed by Philip F. Anschutz, a Colorado billionaire businessman who is also co-owner of the Los Angeles Kings hockey team.