California Communities Celebrate ‘Massive’ Victory as Oil Industry Drops Unpopular Referendum

Environmental justice communities across California rejoiced last week when the oil industry, at the eleventh hour, withdrew its controversial effort to overturn a historic law aimed at curbing the deadly effects of neighborhood oil drilling.

Now, nearly two years after community activists and their allies watched Gov. Gavin Newsom sign the bill they’d worked for years to get through the Legislature, they can finally breathe freely.

Senate Bill 1137 prohibits new permits for oil and gas wells within 3,200 feet of homes, schools, clinics and other so-called sensitive sites, and tightens oversight of existing wells within the buffer zones.

Newsom signed the bill in a high-spirited ceremony in September 2022 as part of a sweeping package of climate measures to accelerate the state’s transition to clean energy.

But the ink had barely dried on the landmark public health measure when the oil industry filed a referendum to kill it. Oil industry trade groups and neighborhood drillers quickly poured more than $20 million into a deceptive campaign, dispatching petition circulators who lied to voters, saying the referendum would lower gas prices or—shockingly, as happened to this reporter—that it would protect neighborhoods from oil drilling, when in fact it would do the opposite.

Such tactics helped the referendum qualify for the ballot last February. At the time, grassroots activists and the bill’s coauthors, state senators Lena Gonzalez (D-Long Beach) and Monique Limón (D-Santa Barbara), vowed to keep fighting to protect the millions of Californians who live near oil wells from their noxious emissions.

Gonzalez heard rumors swirling around the Capitol that the oil industry might pull the referendum. But she told colleagues, “I won’t believe it until I see it.”

The senator had watched the industry deceive voters, mischaracterize her health protection law as an “energy shutdown” and ultimately spend more than $37 million, according to state campaign finance records, seeking to overturn science-based provisions to safeguard California’s most vulnerable residents from fossil fuel extraction’s litany of harmful effects. 

The small producer Signal Hill Petroleum—which operates marginal wells in dense urban neighborhoods at the southern end of Gonzalez’s district—spent more than $3.2 million in just over a month to get the referendum on the ballot, which automatically froze implementation of the law.

Since the law passed, the industry and its allies spent more than $60 million on lobbying and advertising to overturn it, according to the Campaign for a Safe and Healthy California, a broad coalition of groups working to defend S.B. 1137.

Grassroots organizers who grew up experiencing the deadly effects of neighborhood oil drilling quickly rallied to protect what many saw as one of the most significant environmental health wins in years, to ensure future generations would not suffer the same ills they’d endured.

Oil and gas operations emit chemicals linked to cancer, reproductive harm, fatigue, dizziness, tremors and respiratory system irritation. People living closer to wells have higher rates of asthma and other respiratory ailments including reduced lung strength and capacity, nosebleeds, headaches, fatigue, sore throats and watery eyes. Chronic exposure to a drilling site is as harmful as breathing secondhand smoke, researchers found in a recent study of a densely populated neighborhood near a South L.A. oil field, where most residents are low-income Blacks and Latinos. 

Researchers have also linked living near wells to childhood cancer, cardiovascular disease, birth defects, preterm births and early death.

High-Powered Campaign to Keep the Buffer Zone Law

Gonzalez believes the oil industry withdrew its referendum because it had no chance of passing. 

Polls showed that nearly 70 percent of voters support the setback law, “and we were just relentless,” she said.

“We’ve had this really great campaign, with a huge coalition of Republicans and Democrats,” Gonzalez said, referring to celebrities like longtime environmental activist Jane Fonda, former Republican Gov. Arnold Schwarzenegger and Newsom adding A-list star power to an effort driven for decades by a broad-based coalition of grassroots activists. 

“Oil companies call the frontline communities sacrifice zones,” Fonda said at a March campaign kickoff rally to keep S.B. 1137 on the books in Los Angeles’ Ladera Heights, a predominantly Black neighborhood sitting atop the massive Inglewood Oil Field. 

Newsom took the opportunity to repeat a criticism of the fossil fuel industry’s climate-change disinformation campaigns he’s made so often it’s now on TikTok. “Big Oil has played us for fools for decades and decades, buying off politicians of all political stripes, lying to you,” the governor said.

Schwarzenegger, standing in front of active pumpjacks, echoed what many of the community members and activists at the rally have observed: “Of the 2.7 million people who live next to oil wells, there were … no oil executives living close by.”

It’s Black and Latino and low-income Californians who are most likely to be living for years near carcinogen-spewing oil and gas wells, research published last year shows. Conventional and unconventional oil and gas extraction like fracking deploy many of the same toxic chemicals, experts say, making both highly dangerous neighbors. 

“We’re never gonna stop fighting for setbacks,” said Luis Martinez, campaigns organizer with the nonprofit Fossil Free California. “And we really made that clear.”

Organizers and legislators pressured the oil industry on many fronts to safeguard the hard-won buffer zone law, Gonzalez said, pointing to last year’s referendum reform law, authored by Assemblymember Isaac Bryan (D-Culver City), which requires clear language on the ballot.

Oil industry representatives approached legislators at the beginning of the year seeking carve-outs to S.B. 1137. Gonzalez saw no point in negotiating with an industry “that does not care about our communities.”

But Bryan saw it as an opportunity to deploy legislation “rooted in our phaseout goals and make the polluter pay framework” as additional pressure points to counter the industry’s pushback. “Frontline communities have really led the charge, putting huge, huge weight on the industry,” Bryan said. “And we felt we had to do our part as allies and partners.”

He called Assembly Bill 2716, which would charge oil companies $10,000 per day for operating low-producing wells within buffer zones, as among “the most noteworthy” pressure points.

“I think the oil industry did not believe that we could move a bill like that,” Bryan said, especially after the California Independent Petroleum Association, a major backer of the referendum, asked him to hold it. But Bryan and his colleagues moved it through the Assembly and then through the Senate Natural Resources and Water Committee without amendments last week, before the industry pulled the referendum. 

Bryan did offer the oil industry a concession: to limit A.B. 2716 to the oil field in his backyard, Inglewood, the largest urban oil field in the nation. They’re still hashing out details about how income derived from the penalties should be distributed.

Other measures included a gas price-gouging law, passed last March, and the Newsom administration’s lawsuit charging the oil industry with “wreaking havoc on our planet and lying to people about the dangers of fossil fuels.”

The setback victory is a testament to the power of organizing by communities that have long suffered the direct impacts of fossil fuels and other polluting industries, Martinez said. 

“Communities have been leading this fight against the fossil fuel industry and oil drilling for a long, long time,” said Martinez, who grew up surrounded by oil wells and five refineries in Wilmington, near the Port of Los Angeles. He called it “amazing” to see decades of organizing pay off as the Campaign for a Safe and Healthy California benefited from press attention and endorsements by the likes of Newsom and Schwarzenegger.

“I think the fossil fuel industry saw that power, the power of that organizing and that momentum,” Martinez said. “And I think they knew it was a losing battle.”

The Fight Continues

The day after the oil industry pulled its referendum, California oil and gas regulators served notice to neighborhood oil drillers that their reprieve was over. “All operators are required to comply with the provisions established by Senate Bill 1137,” the notice read. “Failure to do so may result in enforcement action.”

That means Signal Hill Petroleum, which operates only neighborhood wells at the southern end of Gonzalez’s district, cannot get the 20-year permit extension it sought despite robust local opposition, as Inside Climate News reported. Signal Hill did not respond to a request for comment by the time of publication.

Signal Hill Petroleum was clearly trying to get a 20-year extension before the November election, Gonzalez said, “which is insane.”

Yet it’s unlikely the oil industry will simply abide by the law. 

California Independent Petroleum Association, which represents hundreds of independent producers including Signal Hill Petroleum, did not respond to a request for comment. But CIPA chairman Jonathan Gregory told the Los Angeles Times, “We are pivoting from the referendum to a legal strategy since it is a violation of the U.S. Constitution for the government to illegally take private property, particularly operations that were duly permitted by the government and all impacts mitigated.”

As of Monday morning, the oil industry had not filed a legal challenge with state oil and gas regulators.

Bryan called the threat “a final act of desperation,” and said legislators are prepared to respond to any attempts to maneuver around the law.

Gonzalez said S.B. 1137 explicitly guards against taking property. She believes a referendum is the only thing that could stay the law but is awaiting word from state regulators about the potential consequences of a legal challenge.

She called “this takings issue” a red herring. “We’re not taking property away. We’re saying that you cannot continue to pollute neighborhoods.”

That’s why Gonzalez is carrying a bill that holds operators liable for health problems, including respiratory ailments, cancer or pregnancy complications within health protection zones. 

“It basically says, if you continue to drill oil or rework the oil wells, you are exacerbating the health outcomes for these frontline communities,” Gonzalez said. “It’s not fair that the government has to pay hundreds of thousands, if not millions of dollars, for asthma programs and for respiratory illness solutions just because they want to make an extra buck on these oil wells.”

The setback law was a victory decades in the making, but the work isn’t finished, Martinez said. “This is just the beginning.”

For one thing, he said, activists will be working to ensure that setbacks are enforced.

He’s also looking to put forward legislation and projects that advance just transition models and establish resilience hubs in communities to build resilience to the extreme heat waves that are becoming more intense and common with climate change.

“Our climate mission for communities on the frontlines is that you never stop chipping away at the polluter,” Martinez said.

For Gonzalez, it’s way past time to put fossil fuels in the rearview mirror. 

“One in four cars that are being sold in California are electric, and we’re starting to see the shift towards renewables,” she said, noting that markets are starting to focus on reducing reliance on fossil fuels. “You see that more acutely in California, because we have had regulations to say this is where consumers want to go, they want additional options that are less polluting and they want to see this green clean future that we keep promising them.”

Though it was Gonzalez who ultimately moved the setback law through the Legislature, she reserves praise for the environmental justice communities who have been working for years to secure the right to clean air.

For far too long, multiple different polluting industries have been free to pollute communities without regard for people’s health, she said.

“Now we’ve got this pivot point, where S.B. 1137 is the first time we’ve really, really won against Big Oil, and it feels really good,” Gonzalez said. Even her nine-year-old son Luca played a role, showcasing his mom’s oil well bill for a class environmental project. She could hardly contain her pride.

“Those are the generations that are going to be the next leaders,” Gonzalez said. “And I hope that when my kids become my age, they now can breathe a little bit better given this law.”