City Council and BHUSD Seek to Recoup Lost Oil Revenue

A Tuesday of the City Council and Board of Education to discuss plans to halt oil drilling in Beverly Hills ended with an agreement between the two bodies to help the school district deal with the financial impact of the ban.

An passed by the council in January bans oil and gas drilling after Dec. 31, 2016, a date that coincides with the of the Venoco Inc. lease of wells on the Beverly Hills High School campus. The Beverly Hills Unified School District earns about $1 million a year in oil revenue from the well, as does the city. 

But the income is a much more significant part of the BHUSD’s overall budget compared with the city’s general fund.

“Financially, we are in very precarious times,” board President Lisa Korbatov said. “Everyone wants to beat their chest and shut down the oil well right now, but this is a real issue representing real revenue for us.” 

Still, all 10 officials at the meeting agreed that having an oil well on the BHHS grounds was “not a compatible use” for a school campus, as Mayor Barry Brucker described it. They came to such an agreement after several residents said during the public comment period that they favored the ordinance because of the possible health risks of having an oil well on a school campus.

“There is a state law now prohibiting schools from being within 300 feet of an oil well,” Councilwoman Lili Bosse said. “That is telling me something.” 

Several attendees suggested that the BHUSD could make up some of the lost oil revenue by allowing slant drilling of the wells from outside city limits. Slant drilling, however, would add significant costs to obtaining oil and gas from the wells. It is unclear whether Venoco would want to continue operations at BHHS under that circumstance. 

At Bosse’s suggestion, the council and board members agreed to form an ad hoc committee to investigate ways to replace the lost revenue for BHUSD. Bosse said she would serve on the committee, but no board members were named to it.

Korbatov asked that the committee also look at remediation of the well site to ensure that it would be safe for other uses after the well is shut down. She also requested that technical expertise be offered to committee members to help them understand the options that might be available for the site.

Board Vice President Brian Goldberg said he approved of the joint committee idea.

“Lili, your suggestion of a joint task force to look at the revenue issues ensured that concrete action came out of the [Tuesday] meeting,” he wrote in a post on Bosse’s Facebook page. “Thank you for your leadership.” 

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