In the News

County’s future dependent on Cherry Point amendments
There has continued to be significant ongoing activity related to Cherry Point Amendments process. We will reenter the final public phase of the amendments process very soon. It is more important than ever that AGC members reengage when the public process resumes.

Since the last public hearing in November 2020, Cherry Point stakeholders have continued to meet twice a week to negotiate compromises that all parties can live with. The stakeholder’s group is a diverse group made up of business, labor and environmental groups. They are at a very technical stage of those discussions and working through some the most challenging aspects of the proposed amendments — predominately now focused on greenhouse gases and insurance liability coverage.

The refineries at Cherry Point are very complex and highly technical operations. The stakeholder’s group has continued to clarify to the County Council many of the consequences of the amendments as originally proposed. The group regularly updates the County Council on its progress while working with Whatcom County Planning and Development Services to work through staff questions about what is being proposed. AGC has remained in contact with all involved tracking the progress of the Cherry Point discussions. Read more…

You can view the full newsletter from AGC Washington here.

Click here for the the full video on YouTube.

A recent op-ed by a Washington labor leader in the Everett Herald made the compelling case for the Whatcom County Council to be prudent and judicious in how it approaches making regulatory changes with regard to the Cherry Point Industrial Zone in a world still reeling from the economic fallout of the COVID-19 pandemic.

Specifically, Stacy Martin, the business manager and secretary/treasurer for Washington Laborers Union 292, based in Everett and representing Cherry Point workers , said in that “what should be obvious, by now, is the fact that our elected officials must exercise great caution when moving forward with policies that effect our jobs and the businesses that provide them.”

Businesses need certainty, Martin writes, saying that “Cherry Point is already regulated by some of the strictest and most comprehensive environmental regulations in the world. Cherry Point is the economic foundation of Whatcom County, an engine that creates huge direct and indirect impacts. The Whatcom County Council needs to be mindful of these impacts, aware of our current landscape, and very careful that it does not regulate Cherry Point away from Whatcom County.”

Martin also makes the case for Council to follow the recommendations of its Planning Commission who spent considerable time gathering input from all stakeholders to improve Council’s initial proposal.

“The good news is that a clear path forward — with strong community guidance and input — is on the table. A year after the initial amendments were submitted, the county planning commission had its final public hearing on the Whatcom County Council Cherry Point amendments. After working with all stakeholders, the commission made important recommended changes to the council’s amendments, changes that more accurately reflected today’s realities.”

To read the full op-ed: Comment: Cherry Point code must balance environment, jobs | HeraldNet.com

This week, The Lens published an article featuring two prominent members of the Coalition and industry leaders in Whatcom discussing the potential reregulation of the Cherry Point industrial area by the Whatcom County Council. Notably the piece explains that councilmembers could ignore recent Planning Commission recommendations to the proposed changes, a move that could prove disastrous for this area’s economy.

Mills Electric President and CEO John Huntley was clear about the potential impact these proposed changes could have:

“Industries and refineries – they can pack up and leave. If that happens, Whatcom will be a disaster.”

Laborers Local 292 Political Director, Trevor Smith, had this to say during the Council’s September 29 meeting:

“I’m frustrated by how the council seems to be pushing back on the hard-fought compromises that were crafted during the commission process. It’s not perfect and probably won’t ever be, but compromises were found. Industry, labor, environment – everybody came together, worked on this language, and created something…everybody is willing to work with.”

The article highlights the very real impact of the County Council’s actions and the effects that excessive regulation can have on a region’s economy. If you missed it, you can find the article here.

My Ferndale News | June 25, 2020

It is impossible to overstate the degree of uncertainty that defines today’s economic landscape. An economy that was booming mere months ago has been brought to its knees, with more than 30 million Americans unemployed and the path forward still opaque at best.

It may be some time before we are able to project what the future may hold for the economy here in our own backyard, let alone across the nation. But we can say one thing with absolute certainty today: in a market like this, every single job counts. And it is imperative that we do all we can to protect and preserve the jobs that can sustain our community both during this crisis and during calmer times to come.

We can’t control market conditions. We can – and must – control the policy landscape our community creates for the employers who provide thousands of jobs across Whatcom County.

Unfortunately, the actions taken by the Whatcom County Council, currently in the midst of the most aggressive rewrite of the county’s zoning ordinances in decades, are only adding to the uncertainty already facing our economy.

The changes being pursued in Whatcom County would make it exceedingly difficult for existing businesses at Cherry Point to remain competitive, or for new enterprises to invest and grow in our community. The changes are being pursued, evidently, in the name of environmental stewardship. But even long before the pandemic began to take its toll on the market, the uncertainty and anti-business landscape driven by the Council’s actions were having a direct negative impact on the outlook here in Whatcom County.

First, it was the Green Apple Renewable Fuels Facility. Back in January, Phillips 66 and Renewable Energy Group announced that they were abandoning the permitting process that they had been navigating since announcing the project 2018. The two companies had hoped to build a massive, 250 million gallon-per-year renewable diesel facility within the existing Phillips 66 refinery. The project would have been a boon for Whatcom County, creating jobs, generating revenue, and even (ironically enough) contributing to the sustainability of operations at Cherry Point by bringing renewable fuels to the market.

Unfortunately, according to Phillips 66 and Renewable Energy Group, permitting delays and uncertainties derailed the project. Despite the clear benefits of the project, the County dragged its feet on advancing the process and requested a lengthy and costly environmental impact statement. It was enough to make the costs too high and the path forward too uncertain.

The County Executive expressed shock and disappointment at the loss of the “much needed” project. Unfortunately, it wouldn’t be the last such shock suffered by Whatcom County in the first part of 2020.

Last month, Alcoa announced that it would be curtailing production at its Intalco Works smelter in Whatcom County. In operation since 1966, the smelter employed 700 workers. And despite ongoing efforts to improve the facility in recent years, management announced in a press release that the site was no longer competitive given declining market conditions.

Economic analysts expect the loss of the facility to cost the community around 1,400 jobs when all is said and done – another devastating blow at a time when every job counts.

The closure of Intalco is a tragedy that will have a negative far reaching impacts in our County. As being formerly employed at Intalco for just over 10 years, I know many of those people and their families. Today, I work at Petrogas, also located at Cherry Point. We must have business regulations that are more effective in supporting existing employers in Whatcom County and encourages new employers to locate here.

The regulatory changes proposed by the Whatcom County Council for Cherry Point have always had questionable positive value for public safety and the environment, but amid the upheaval of the last few months, the negative impacts to our economy far outweigh the highly uncertain value of the County Council’s proposed changes.

The path forward for all businesses is fraught with uncertainty. Unfortunately, we have only seen the beginning of the economic damage done by COVID 19. There will be many businesses tethering on the edge to stay open. Our leaders must do everything they can to implement policies and regulations to prevent business closures and layoffs.

Right now, the Whatcom County Council’s actions are amplifying uncertainty for companies doing their all to continue to create jobs, revenue, and opportunity in our community.

This can’t continue. Today and for the foreseeable future, officials must focus on stability and certainty – not environmental showmanship. The stakes are too high and the potential costs of such actions are too great.

Whatcom County is a great place to live and work. Let’s do all we can to keep it that way.

Gatlin McConnell
Lynden

Whatcom Coalition for Economic Growth members Trevor Smith and John Huntley took to the airwaves to chat with Dick Donahue on KGMI 790 News about proposed regulations by the Whatcom County Council aimed at limiting business activity at Cherry Point.

Trevor Smith represents the Laborers International Union and has lived in Whatcom since 1984, and John Huntley is the owner of Mills Electric and was born and raised here. During the interview both Smith and Huntley discussed just how serious these regulations could be for the regional economy.

Listen to the full interview from KGMI here or review some notable quotes from Trevor Smith and John Huntley’s interview below:

John Huntley, President and CEO, Mills Electric

• “… we are definitely living with a great deal of uncertainty that is really out of our control … need our elected leaders to work more diligently than ever before to create certainty … at Cherry Point and for the people of Whatcom County. The Cherry Point amendments will not only affect the refineries but will affect people and families and how they are supported.”

• “Our company now…is down 60% with the uncertainty of what is going on [because of the pandemic]. …the uncertainty of what is going on with the County Council just doubles that effect.”

• “…we need an open and transparent and good faith process to continue and let these refineries do what they do best.”

• “…The [Whatcom County Exec. Satpal Sidhu] is a lot more open than I had ever dreamed he would be…if we work together the way the Planning Commission has been working with industry …. I think we can all come up with a plan that will work for everyone.

• “One example is that we had the opportunity to have a great project go out at Phillips 66, a billion dollar project that could be going on right now… with the uncertainty of our County Council and our permitting process … that project went away ….at the same time they were trying to do it here they were doing it on the east coast…the exact same unit. That is now being built with the permits in hand.”

• “There is no doubt that industry is looking at what is going on in Whatcom County… they are not coming this way because they are not wanted which is pretty sad.”

• “With Alco leaving, and with industry not coming in that can pay a good salary, it is just really uncertain what is going to go on in Whatcom County.”

• “What we really need now is full transparency. We need to work together to get our companies at Cherry Point working with the County Council…”

• “…if we work together the way the Planning Commission has been working with industry …. I think we can all come up with a plan that will work for everyone.”

Trevor Smith, Business Agent, Laborers Local 292

• “…when we go to restart the economy the refineries are going to have to go to their parent companies to get funding for projects inside their gates, then they are going to go back to this uncertain permitting process … and it is going to be hard to move forward…”

• “Planning Commission has actually done a really good job listening to stake holders listening to industry.”

• “The tragedy… of having Intalco shutdown is that it is a prime example of where are we going to find those living wage jobs ….The reality is that 700 hundred families are going to have to find new ways to support themselves … and they are probably most likely going to have to go outside the county to find living wage employment.”

• “There is a …. happy medium here where we can make this all work and get the energy and the fuels we need to support daily life and move our economy forward as well as do it cleanly and safely …. that means we need a stable regulatory process.”

• “…let’s make it [permitting] a transparent process… be upfront about it so the companies know what they are getting into…and then they can move forward with their projects. As opposed to creating uncertainty by having a process that just says, just go ahead and build something and we will let you know what you need to do to get it done.”

Dear Coalition Members:

We need your help. The Whatcom County Council recently voted to introduce its ninth consecutive, six-month Cherry Point Fossil Fuel Moratorium.

Whatcom Councilmember Kathy Kershner, who voted against introduction of the ninth Cherry Point fossil fuel moratorium, said during debate that “… the ban is bad for business, particularly as the local economy is reeling from the new coronavirus pandemic, the loss of a proposed biofuel plant and the recent announcement that the Alcoa Intalco Works aluminum smelter will close soon.”

The Whatcom County Council will vote on the Cherry Point moratorium on Tuesday, June 2^nd at its 6:00 p.m. virtual Council meeting. Please see the links below for more details on how to join the zoom Council meeting, register to testify, and submit public comment. Also please see emails below to submit written comment.

In the meantime, we hope you and your families are well and healthy. Stay safe.

Public Hearing Notice
(Virtual Public Hearing)

Tuesday, June 2^nd 6:00pm

http://www.whatcomcounty.us/3415/Virtual-Council-Public-Hearings

http://www.co.whatcom.wa.us/DocumentCenter/View/29107/Public-Notices?bidId=

Zoom Instructions:

http://www.whatcomcounty.us/DocumentCenter/View/47537/Instructions-for-Joining-Virtual-Council-Public-Hearing-WEB-OR-MOBILE-APP

Email Addresses for comment:

Whatcom County Executive: [email protected]

Whatcom County Council:

[email protected] – General

[email protected]

[email protected]

[email protected]

[email protected]

[email protected]

[email protected]

[email protected]

This week, Lance Calloway, Northern District Manager, with the Associated General Contractors of Washington, authored the below commentary in AGC of Washington’s newsletter:

Cherry Point plan is risky for Whatcom County and our region  

Nothing is more important to the overall well being of a community than access to economic opportunity. For Whatcom County, there is perhaps no more crucial engine for that opportunity than Cherry Point and the businesses that call it home. This now more important than ever as we recover from the COVID 19 crisis.

The recent announcement that the Intalco Aluminum Smelter is closing costing 700 jobs is a harsh reminder we need a regulatory environment that helps large industrial employers compete but also that we need to work with our elected officials to create a regulatory environment that sends a strong message encouraging innovative forward thinking industrial employers to Whatcom County and the region.

We need to work closely with our elected leaders to create a regulatory scheme that has the proper protections for the public, workers and environment but also actively encourages existing businesses to thrive and attracts future employers to industrially zoned areas like Cherry Point.

More than 10,000 people look to Cherry Point businesses to support their families with good-paying jobs and benefits. The companies based in the industrial zone pay $200 million in taxes each year – vital funds that keep our most important public services functioning. And employees and organizations alike give back to the region via thousands of hours of voluntarism and more than $1 million in philanthropic giving.

As we address damage done to our economy by the COVID 19 crisis we must work together across the political and ideological spectrum – to help our economy evolve to a future embracing green industries. We cannot, however, afford to lose sight of the role that’s played by the companies currently located at Cherry Point. They play a critical role restoring the family wage jobs that have been lost due to the pandemic.

Whatcom County has a significant number of contractors and other companies who directly and indirectly depend on the Cherry Point businesses to be able to provide their employees their livelihood. For example, the contractors work keeps the refineries at Cherry Point running safely while also continually improving and reducing emissions impacting our environment. There are approximately 700-750 construction workers who call the Cherry Point refineries their permanent office, as they have long term maintenance contracts enabling them to earn a great living wage.  During the major maintenance turnarounds there can be as many as an additional 3000-3500 construction workers who work two to three months on major projects, with a substantial percentage living in Whatcom County.

Unfortunately, for the last four years prior to COVID 19 the Whatcom County Council has attempted to push through a new onerous regulatory framework for Cherry Point. These changes had questionable value to the public, workers and the environment prior to the pandemic and make even less sense in a the post COVID 19 economy. These changes if enacted would likely cost us jobs, tax revenue, and investment in all sectors – including renewable energy. The Whatcom County Planning Commission in it review has also pointed out many flaws that would harm the refineries at Cherry Point.

Also right before COVID 19 crisis a renewable diesel project in Whatcom County was abruptly cancelled, and one has to wonder what – if any effect – the uncertain regulatory environment at both the state and local levels had on the decision to cancel the project. The cancellation of the nearly ONE-BILLION dollar project eliminated the opportunity for an estimated 650-700 construction workers to build an environmentally friendly project over a period of two years. In talking with a local contractor, this cancellation cost them and two other contractors nearly $500 Million.

Again, if we had concerns about the proposed changes to Cherry Point regulations before now those concerns are magnified many times over.

It’s clear that the new plan would devastate refineries. The added review requirements would make it next to impossible for these facilities to invest in modernization or expansion, making it more difficult for these otherwise state-of-the-art facilities to keep pace with competition outside our area.

Also, from an environmental standpoint, since renewable energy companies at Cherry Point will also have to reckon with the same impediments to investment that traditional refiners will. On the whole, this misguided regulatory move will increase emissions rather than improving the environment.

The impacts of this proposal reach beyond the energy sector, and beyond Cherry Point at large. In considering these changes, Whatcom County officials are sending a clear and unwelcoming message to any and all companies that might otherwise look to invest in Whatcom or Washington state generally. Growing a business requires a measure of policy certainty and stability. The Whatcom County Council’s proposed changes for Cherry Point undermines that stability by making it harder to invest and expand.

Whatcom County is very fortunate to have Cherry Point to attract the family wage jobs we have recently lost. If this Whatcom County Councils continues with its proposal, the foundations of our regional economy are at risk. It is this uncertainty that concerns our business community as investors will look outside of Whatcom County to build the next production facility or plant bringing with it a trickle down impact on housing and other local businesses and schools depending on Cherry Point.

We are dealing with too much economic uncertainty we cannot control; we must increase certainty where we can. A positive regulatory scheme so businesses can thrive in our new normal is a great place to start.

Lance Calloway
Northern District Manager
Associated General Contractors of Washington