Vast new limits urged for proposed Oakland shipping terminal

Phil Tagami at the site of a development at the Oakland Army Base in Oakland, California, on Wednesday, Sept. 23, 2015. Phil Tagami at the site of a development at the Oakland Army Base in Oakland, California, on Wednesday, Sept. 23, 2015. Photo: Connor Radnovich, The Chronicle Buy photo Photo: Connor Radnovich, The Chronicle Image 1 of / 1 Caption Close Vast new limits urged for proposed Oakland shipping terminal 1 / 1 Back to Gallery

A planned shipping terminal in Oakland could face a new set of restrictions, even after officials decide, in June, whether to ban its developer from exporting millions of tons of coal from Oakland’s docks.

At a public hearing Monday, environmentalists urged the City Council to prohibit not only coal but a whole array of fossil fuels from being shipped. They said the terminal — which is a key piece of developer Phil Tagami’s plan to resuscitate 366 acres at the long-defunct Oakland Army Base — could be the source of a major disaster.

“It could poison the waters of the bay,” said Jeremy Gong, an organizer with the San Francisco chapter of the Sierra Club. He later told The Chronicle that the planned terminal, which would be about a quarter mile from the Bay Bridge toll plaza, would send coal dust wafting over thousands of cars that travel across the bridge daily.

Deborah Moore of the Union of Concerned Scientists called the terminal “an accident waiting to happen.”

Moore and Gong were among dozens of speakers who pressed the council to stick by a resolution it passed in 2014, a year after it signed a deal with Tagami to build a terminal near the east end of the Bay Bridge. The resolution bans transport of coal and other hazardous fossil fuels through the city, for fear of explosions or oil spills that could cause toxic chemicals to leak into the surrounding neighborhoods.

Though the resolution initially had nothing to do with Tagami’s project, it’s become a political tool for city officials who are now trying to tweak their 3-year-old development contract. Some of them say they approved it not knowing that the terminal could be used to ship coal.

“It shows we’re not just doing this to mess with Tagami,” Councilwoman Rebecca Kaplan said of the resolution.

At Monday’s hearing, the council contemplated whether to place a preemptive ban on crude oil and other fossil fuels — everything besides coal that could be exported from the terminal. In September of last year, the council held a similar hearing, but focused on a more concrete plan to export coal mined in Utah through Oakland. In March, Utah’s Legislature voted to spend $53 million in taxpayer dollars on Tagami’s project.

“If we don’t enact a regulation or ban prior to them building the terminal, then it could be too late,” said Councilman Dan Kalb, who called for the hearing Monday.

The council could decide as early as June 27 on whether to change its agreement with Tagami. Kalb and other officials are hanging their hopes on a clause in the contract that says the city can’t sign away its right to protect the health and safety of Oakland residents. If they can prove that coal will damage lungs and send noxious chemicals into an area that already has high asthma rates, then that clause could allow officials to modify the deal.

But imposing new regulations could put the terminal project at risk. It could also derail Tagami’s larger development: turning Oakland’s former base into a thriving stretch of industrial waterfront, adding maritime support services, a recycling center and a rail line. The entire development promises almost 12,000 jobs to an area that desperately needs them.

What’s more, the city will open the door for lawsuits if it decides to change its contract, said Larry Kamer, a spokesman for Tagami’s real estate firm, California Capital & Investment Group, which will finance the $250 million Oakland Bulk and Oversized Terminal.

“The city has made commitments, and we expect the city to live up to its commitments,” Kamer told The Chronicle on Monday. “Leases have been signed, funds have been exchanged, and people have been hired. People are on the job right now building this facility. We’ve lived up to our commitments, and we expect the city to do the same.”

Yet pressure is mounting from political leaders who’ve lined up against the coal plan. Among them is state Sen. Loni Hancock, D-Berkeley, who is pushing two bills in Sacramento. One would require a new environmental review of the Oakland terminal. The other would cut off state funding for ports handling coal.

Those bills could arrive at Gov. Jerry Brown’s desk as early as June.

Rachel Swan is a San Francisco Chronicle staff writer. Email: rswan@sfchronicle.com Twitter: @rachelswan