The Fraud of Environmental "Protection"

By Richard Brenneman
Thursday June 17, 2010 - 09:08:00 AM

Folks with a modicum of common sense have good reason to worry about oil spills and toxic waste sites. The former can pollute vast regions of sensitive wildlife and human habitat, while the latter pose more focused threats. 

In theory, both the National Environmental Protection Act [NEPA] and the California Environmental Quality Act [CEQA] supposedly ensure that any new development which poses potential threats to the environment and the critters living therein will be thoroughly vetted for potentially harmful consequences and measures taken to prevent of contain them. 

But in the course of six years of writing extensively about both sets of regulations, huge flaws in both have become apparent. 

Perhaps the greatest single threat arises from the ability of regulators and legislators to waive environmental review or ignore the dangers raised by the review whenever they deem the projects important because of “overriding considerations,” as the California law phrases it. 

One consequence of such waivers is the mass of oil now contaminating the Gulf of Mexico and spreading slowly but inexorably into the waters of the greater Atlantic. 

As Ian Urbina writes in the New York Times

the days since President Obama announced a moratorium on permits for drilling new offshore wells and a halt to a controversial type of environmental waiver that was given to the Deepwater Horizon, at least seven new drilling permits and five waivers have been granted, according to records. 

The records also indicate that since the April 20 explosion on the Deepwater Horizon, federal regulators have granted at least 19 environmental waivers for gulf drilling projects and at least 17 drilling permits, most of which were for types of work like that on the Deepwater Horizon shortly before it exploded, pouring a ceaseless current of oil into the Gulf of Mexico. 

Asked about the permits and waivers, officials at the Department of Interior and the Minerals Management Service, which regulates drilling, pointed to public statements by Interior Secretary Ken Salazar, reiterating that the agency had no intention of stopping all new oil and gas production in the gulf. 

So, what’s shaping up as one of the worst environmental disasters of modern times got a free pass from regulators, with the “overriding consideration” being the nation’s hunger for the planet’s dwindling reserves of fossil fuel. 

Again, quoting from Urbina’s article: 

At least three lawsuits to strike down the waivers have been filed by environmental groups this month. The lawsuits argue that the waivers are overly broad and that they undermine the spirit of laws like the National Environmental Policy Act and the Endangered Species Act, which forbid drilling projects from moving forward unless they produce detailed environmental studies about minimizing potential risks.

Choosing their own watchers 

But even when projects undergo reviews, there’s on huge problem. Developers, whether governmental agencies or corporations, get to pick their reviewers. 

There’s a host of companies who conduct reviews, making lots of lucre in the process. These are private corporations, staffed by university planning department graduates. 

And while the process is supposed to be conducted in an impartial, unbiased manner, the reality is somewhat different. 

One leading firm conducting reviews in California is based here in Berkeley, Design, Community & Environment. Founder David C. Early “is also the head of Livable Berkeley, a group that advocates strongly for the sort of ‘infill’ development that has proved a hot potato in the community.” 

Questions naturally arise concerning the objectivity of a company’s reviews of projects which embody concepts for which it has already declared a favorable bias. 

DCE has also worked as a subcontractor to other companies doing environmental assessments, including work on an EIR for the University of California’s newest campus at Merced under another outfit called URS. The Berkeley firm also worked on other projects at UC Berkeley where URS was the designated contractor. 

A conflict of interests 

URS also did environmental monitoring at UC Berkeley’s Richmond Field Station, where the university is planning a massive corporate industrial park on a site with a long, highly complex history of toxic pollution. Why URS could work on UC projects at the time remains an open question, given that the company was controlled at the time by Richard C. Blum, a member of the UC Board of Regents and spouse of Sen. Diane Feinstein, the powerful California Democrat. 

Blum’s company was also awarded the contract to build the $750 million UCLA Ronald Reagan Medical Center while Blum was serving on the board. 

[For an excellent overview of some of Blum’s other conflicts see this article by Peter Byrne.] 

Only in 2005 after students and a handful of journalists pointed to the conflicts of interest inherent in Blum serving as developer on projects he approved as regents did the wealthy builder sell off the interest in the firm he had controlled for three decades. 

Also serving with Blum on the URS board was retired General Joseph Ralston, the former Vice Chairman of the Joint Chiefs of Staff and current Vice Chairman of the Cohen Group (former Defense Secretary William Cohen's firm) as Sourcewatch reports. Cohen, by the way, is also partner of another San Francisco Bay Area project undergoing environmental review, a billion-dollar-plus resort casino project planned for one of the region’s poorest cities, Richmond. 

The Sacramento-based company conducting that review has a long history of making favorable findings on tribal casino projects in the Golden State. 

Back to the oil spill 

So what happened with Deepwater Horizon and the other offshore drilling projects still being rushed through the approval process? 

Corruption with the approving agency, the Department of the Interior’s Minerals Management Service, clearly paid a significant role, as the BBC reported last month. 

A 2008 interior department investigation found some MMS employees took drugs and had sex with energy company representatives. 

Some staff had also accepted gifts and free holidays, amid “a culture of ethical failure,” according to the investigation.


Federal and journalistic investigations are still underway, and Interior Secretary Salazar has promised a major regulatory overhaul. 

But when it came to getting to the bottom of the BP disaster, more questions remain that answers, as Ryan Knutson and Marian Wang discovered when they took a look for ProPublica, the non-profit foundation created by a pair of banksters who got out when getting was good—and highly lucrative. 

As you may have heard, before the big BP disaster the government’s chief oil drilling regulator let most drilling go forward in the Gulf of Mexico with very little environmental review. Somehow, the Minerals Management Service decided that there was little chance of disaster and thus gave the entire central and western Gulf an exclusion from a requirement for comprehensive environmental reviews. 

Yes, you heard that right. Drilling projects in the entire central and western Gulf of Mexico have what the government calls a “categorical exclusion” from detailed environmental studies. The Gulf, by the way, is where most of the nation’s offshore drilling takes place. (Here’s a handy flow chart from the government showing the approval process.) 

How such a broad exclusion was established is an enduring mystery. 

On its website, the MMS says categorical exclusions are established “based on experience,” and only after “hundreds” of studies have been completed without showing significant impacts. 

That raises the question: When did the MMS do so many studies in the Gulf that it decided they were no longer necessary? And who approved that decision and why? 

We’ve spent the better part of a month trying to unravel it, and the answer we have so far: The exclusion was created a long time ago, but not even the government knows exactly when or where it came from.


A modest proposal 

The highly flawed legal process for conducting environmental reviews demands reform. The two major system failures result from two quirks in the existing federal and state laws. 

Being of a suspicious mindset, one might conclude that the legislative flaws were the fruits of prodigious lobbying rather than ineptitude on the part of lawmakers. 

The first problem is the matter of picking the specialty firm of experts hired to conduct a review. As the laws now stands, the developer—the party with the most to gain—makes the choice, while the public—those with the most to lose—have no say. 

So it’s no wonder that companies pick reviewers with track records for favorable findings. After all, a corporate officer has fiduciary obligations to shareholders, right? 

Two alternatives offer better hopes for the community interest. First would be to continue the process of private reviews, but make the choice a matter of a blind draw, eliminating a choice based on reviewer favoritism towards specific types of projects. 

The second alternative would be the creation of public reviewing bodies, perhaps drawn from academic faculty, with a fixed percentage of fees going towards the general funds of cash-strapped public universities. Of the two options, this would serve the public interest best—provided the academic reviewers were barred from taking jobs with companies they’d reviewed. 

The other problem concerns the matter of the findings of overriding considerations that allow projects to move forward when there are judged to be public needs that transcend the project’s harm to the environment. 

Keeping America’s SUV’s on the road and the reduction of dependence on foreign oil in an age of political turmoil will always trump environmental damage when politicians and their appointees look at drilling projects, especially when contributions from oil companies and their fronts play a major role in elections for national office—as well as those of defense/military contractors who profit so richly from the turmoil. 

On the local level, especially here in California, cities and counties are more dependent than ever on the fees paid by developers and the property taxes paid by the project’s new owners. Rejecting a project may also mean killing a much-needed social program or laying off valuable employees. Revenue’s certainly an overriding consideration for city government, and there’s sure to be a big temptation to rubber stamp projects that’ll feed the anemic city revenue stream. 

Now add the political factor. Even in a self-styled “progressive” city like Berkeley, contributions from the development community reign supreme [see here]. 

So it’s no surprise that, as a general rule, in Berkeley developer-favored candidates win. 

Some variant of the same mechanism proposed above for environmental reviews—creation of a public body, possibly through the university to review the findings of overriding consideration, subject to appeal through an administrative law review or a trial by jury in a state superior court. 

On the federal level, similar controls could be implemented, including a law that mandates all future drilling projects must be subjected to a review by a panel of experts. 

The process of environmental review, as it currently stands, doesn’t serve the public interest. It’s time for a change.