Oakland Coal’s Wheel of Influence

Leaked documents about the effort to sell a coal terminal to a reluctant city show how the government sausage gets made.

Last year’s Oakland City Council election provided supporters of the controversial proposal to ship coal through Oakland with a potential opportunity to find common ground with city officials. The November election ushered in three new members of the eight-person council: Nikki Fortunato Bas, Loren Taylor, and Sheng Thao. To honor those new members, the Oakland Builders Alliance held a January reception for them at downtown’s posh Rotunda Building.

The soiree represented an opportunity for Insight Terminal Solutions, the Utah company hoping to transport coal and its byproducts through the Oakland port terminal. At the party, company founder and CEO John Siegel spoke briefly with each of the new councilmembers, hoping to gain insights into where each member stood on the contentious issue. Siegel’s goal was to gauge whether an amicable solution could be reached in the dispute over whether to allow coal to be shipped through the $275 million Oakland Bulk and Oversized Terminal near the mouth of the Bay Bridge.

In a leaked memo from the CEO to his investors, Siegel communicated that he believed councilwoman Thao wanted a quick resolution. Meanwhile, despite preconceived notions about Bas and Taylor, he expressed surprise that both of them also appeared amenable to discussing the matter further.

Based on outward appearances, Bas would seem to be an unlikely ally for coal; her upset of councilman Abel Guillen last year was accompanied by a heavy dose of populism. Yet Siegel believed that he spied a potential opening with Bas. “I was surprised at her receptivity as she had been characterized as one who would align herself with the mayor,” Siegel wrote of Bas. Siegel also expressed surprise that Taylor appeared interested in hearing his side of the story — as opposed to what the CEO characterized as “all of the Sierra Club’s propaganda.” Siegel wrote that Taylor had been characterized to him as “one who would sit the fence, but he seemed to be also very receptive about sitting down and getting to know more about what is different about our project.”

In 2014, acting on behalf of another company, Siegel had signed a contract with terminal developer Phil Tagami to potentially lease and operate the export facility. Siegel’s first company dissolved in 2018 and Insight Terminal Solutions, which featured several of the same key players, then signed an exclusive option agreement to operate the terminal at the former Oakland Army Base, which the city owns.

Although the flamboyant Tagami has come to be seen as the public face of the Oakland coal project, he is merely the developer hired by the city to transform the former base into an economic engine for Oakland. Siegel and Insight Terminal Solutions are the coal experts, and they have been the primary drivers of the effort to ship the commodity through Oakland.

In a revealing memo and log of meetings that was obtained by the East Bay Express, Siegel provided an intimate look into the multi-pronged approach that special interests such as his company use to get their pet projects in front of elected officials. Over the course of roughly nine months, he and other officials from the Kentucky-based company traveled to the nation’s capitol, Florida, Georgia, Illinois, Utah, Japan, and, especially, Oakland for at least 23 separate meetings with elected officials, consultants, lobbyists, labor leaders, community activists — even a blogger and a football player.

The purpose of Siegel’s wide-ranging lobbying campaign was to overturn the city council’s 2016 ban on the storage and handling of coal and petroleum coke in the city of Oakland. Meanwhile, Tagami’s company has waged a parallel court battle to overturn the ban, aided by funding from Siegel. As of this date, the legal efforts have been far more successful than the lobbying campaign. Last year a federal judge ruled that the city had breached its 2013 contract with the developer. The city is appealing its loss. Opening arguments in the case began earlier this month.

The two-page memo from Siegel to his investors is not particularly nefarious in any sense. It’s basically just one man’s recipe for how to make sausage at Oakland City Hall. Siegel’s formula included meeting with sympathetic GOP officials, enlisting the aid of lobbyists and other influencers, and attempting to win over influential members of the community — all with an eye toward flipping the city council.

Here’s what the plan looked like:


Friends of Coal: Federal Officials

Most lobbying efforts in Oakland typically focus solely on the city government, and some also include state legislators in Sacramento. But few rise to the federal level. Because the Insight Terminal Solutions’ proposal crosses over many state lines, Siegel, reached out to some of the highest levels of the Trump administration and Congress for help.

It’s no secret that the Republican Party establishment is strongly aligned with the fossil fuel industry. Climate change deniers make up a sizable of its leadership, including President Trump, himself.

In October 2018, a team led by Siegel met with Transportation Secretary Elaine Chao to discuss Oakland coal. According to the travel log, one of the aims of meeting with Chao was to seek additional face-time with U.S. Energy Secretary Rick Perry and Commerce Secretary Larry Kudlow. Also at the meeting in Washington, D.C., was Ronald Batory, the administrator of the Federal Railroad Administration and Admiral Mark Buzby, administrator of the U.S. Maritime Administration.

Siegel’s team then met in early December 2018 with Senate Majority Leader Mitch McConnell. Presumably this meeting was less difficult to schedule, since McConnell is married to Chao. In addition, like McConnell, Siegel is also a Kentuckian.

In late April, Siegel, Tagami, and Insight Terminal Solutions COO Jim Wolff met with two officials from Oxbow Carbon, a company that specializes in the shipment of natural gas and petroleum coke. Oxbow Carbon’s presence in the Oakland coal lobbying effort is problematic from a public-relations standpoint because the company was founded by William I. Koch, one of the politically conservative Koch Brothers, who are often villainized by progressives across the country. Wolff met with Koch himself in March of this year on the subject of Oakland coal.


The Deciders: City Officials

Among Siegel’s long list of Oakland officials and insiders, one name appears more than any other. In late October 2018, Oakland Council President Rebecca Kaplan met with Siegel and Insight Terminal Solutions COO Jim Wolff, along with Councilmember Lynette Gibson-McElhaney. Kaplan was the first elected official to meet with Siegel and Wolff during this period of time. The next month Kaplan sat down with Siegel and Wolff for a second time, the same day they also met with Councilmembers Noel Gallo and Gibson-McElhaney. In total, Kaplan apparently met with the coal backers on four separate occasions.

In his memo, Siegel described having valuable and “fairly detailed one-on-one time with newly elected President of the Council, Rebecca Kaplan.” Tagami later joined that conference, which took place at his Rotunda Building. Siegel wrote that Tagami told Kaplan “that he would present her with additional briefings and facts … that may not have been disclosed to her before by officials in the current city administration.” Precisely what new information Tagami was offering Kaplan is unclear. He declined to discuss the matter in an interview and whether there was an effort to undermine the city’s attorney’s judgment in choosing to appeal the city’s defeat in federal court.

Siegel wrote that he encouraged Kaplan to use her office to bring together disparate parties in the city in hopes of reaching a settlement. That appears to have happened. Kaplan met a third documented time with Siegel and Wolff in March attended by Ces Butner, the president of the Port of Oakland Board of Commissioners. And Kaplan’s last meeting with the pair, a gathering with Oakland lobbyist Greg McConnell in attendance, was the last documented meeting on the travel log, occurring last July.

In addition to Kaplan, Siegel eventually talked with every other member of the City Council one way or another — either through direct meetings or at the January Oakland Builders Alliance reception. While he voiced measured optimism about swaying some members of the council, he did not express much optimism about flipping one member. Councilmember Dan Kalb, who has strong ties to Sierra Club and is an avowed environmentalist, “exchanged pleasantries” with Siegel at the reception, but the executive quickly concluded that Kalb “will not be won over.”

Siegel also met with Assemblymember Rob Bonta and his then-district director Jim Oddie to discuss Oakland coal. Others city officials, included Oakland school boardmember James Harris and Oakland Fire Chief Darrin White, were added to the loop.


Bloggers & Lawyers: The Influencers

Perhaps nothing has been more influential in turning the Oakland City Council against the coal project than the widespread belief that coal dust represents a health hazard to the residents of West Oakland who live nearest to the Oakland Bulk and Oversized Terminal. Siegel has a problem with that.

“Coal is not dirty,” he said in an undated video, reposted last October on YouTube. “The notion that if you live near a power plant that you could ingest coal dust or it could worsen asthma, or that you’ll see it on your car and write your name, that is all complete bunk. That’s nonsense.” The video was repurposed from what appears to be an interview with a local Utah television host.

Siegel’s comments were preceded in the video by a brief introduction from Zennie Abraham, a well-known Oakland gadfly who long ago served in Oakland Mayor Elihu Harris’s office and runs a media marketing company that reportedly encompasses 98 blogs. As the Oakland coal story began to blossom sometime around 2013 and 2014, a flood of news articles highlighting the potential health concerns due to coal shipments in the East Bay cascaded into the general public’s mindset. Insight Terminal Solutions and Tagami were clearly being trounced on the PR front.

Abraham has happily provided Oakland coal with an alternative path around the mainstream media to get its side of the story out to the public. His stories on the rudimentary-designed Oakland News Now blog often rise to the top of Oakland-related Google searches and appear to the untrained eye to be objective news stories. But these stories portraying Oakland coal in a favorable light are actually content paid for by Insight Terminal Solutions.

“I don’t hide it,” Abraham said. “I sought to get paid. I begged to be hired by them.” Local mainstream media outlets purport to be objective, he added, but they exist to convey the point of view of special interests. “My point is, ‘Tell the truth.’ I’m picking a fight with how things are done,” he said. “Somebody has to bite the bullet and blast this shit.”

Siegel approached him because they were “having a hard time getting out their word,” Abraham said. “I only work with issues that I agree with. This is about a vendetta with me. It’s about writing a wrong because a lot of the officials in the city of Oakland are lying.” When asked to describe the vendetta, he said, “It’s about how they treat Phil. He’s always wanted Oakland to be its best. He’s helped so many people, sometimes out of his own pocket.”

Despite the financial entanglements, Abraham said Insight Terminal Solutions provides no editorial oversight over what he publishes. “They don’t check. I told them the deal is, ‘I agree to do the project, so let me do this my way.'” Abraham would not reveal how much is paid by Insight Terminal Solutions. Instead, he said that Hearst Media Services, which owns the San Francisco Chronicle, offers content marketing services for more than $100,000. “I can assure you I get paid much less,” he said with a guffaw.

Siegel also met with other people who could be described as Oakland influencers. He attended two meetings that also involved attorney Zachary Wasserman. Siegel’s memo described Wasserman as someone “who counsels everyone from the mayor to each of the councilmembers on various issues. While he is outside counsel, he is referred to as ‘Mr. Oakland’ by most and his advice is generally, in my opinion, heeded when solicited and given.”

Other people were courted by Siegel include Oakland Metropolitan Chamber of Commerce President Barbara Leslie, Act Fulls Gospel Church Pastor “Bishop” Bob Jackson, and former Mayor Elihu Harris. During meetings in January and two days before Valentine’s Day earlier this year, Siegel and Wolff met with a number of labor officials, some of which represent members who could benefit from additional work at the bulk terminal. They included Andreas Cluver, the head of the influential Alameda County Building Trades Council, and also a current Port of Oakland commissioner; Doug Bloch, political director for the Teamsters Joint Council 7; Brian Lester of the Operating Engineers Local Union Local 3; and Capt. John Carlier of the San Francisco Bar Pilots Association.


Coal’s Point Man: The Lobbyist

The precursor to Insight Terminal Solutions was ostensibly run by two former executive directors of the Port of Oakland, Omar Benjamin and Jerry Bridges. Most opponents of Oakland coal believed that Bridges and Benjamin were merely frontmen for the coal company. The speculation over their involvement appears to be correct, according to Siegel’s memo. Bridges and Benjamin were paid to strategize and lobby Oakland officials, but Siegel believed they were not successful. So he sought the help of well-known Oakland lobbyist Greg McConnell.

“He would be available 24/7 to strategize with us, meet with us and most importantly, accompany us/or conduct meetings with target community activists who once won over to our side, could help us immensely with various city council members,” Siegel wrote. “It is exactly what I had been paying Jerry Bridges and Omar Benjamin for two years to do but for whatever reason, they did not accomplish the task.”

As head of the McConnell Group and Oakland Jobs and Housing Coalition, McConnell is often a fixture at Oakland City Hall and at the lectern inside council chambers, where he often addresses councilmembers during public comment. Siegel met with several times with McConnell during this period and came away certain he would be his new point man.

“I have watched Greg, who is an influential African American lobbyist and businessman, and I believe he is as good as we could hope for as an advocate for our message within our target community community,” Siegel wrote.

He didn’t come cheap. Siegel wrote that he cost an upfront annual fee of $15,000 and a short-term retainer of $7,500 a month.

In an interview, McConnell said that his role is to assess who is being affected when a proposal is brought to the city. “Because quite often in Oakland, the people who speak vociferously are not the people affected in the community,” he said. “As it pertains to this terminal, there were a lot of people from the Sierra Club, a lot of environmentalists from the hills and many from out of town. I would say most from out of town. They spent most of their time on the impacts on African Americans in District 3, and the question I had in my mind is ‘Are their concerns about coal dust or their concerns about global issues around clean energy? And are they using allegations that people will be hurt health-wise to buttress their claims?”

McConnell said there’s no evidence local doctors are treating patients for coal-related respiratory factors. Instead, the high level of trucks transporting goods through West Oakland and other environmental concerns are the culprits, he said. “That causes me to say, ‘Who is speaking for whom and why don’t you have someone with a voice to be heard?”

In his memo, Siegel explained part of the strategy behind bringing McConnell on board. “No matter how compelling I may be, I am still a white outsider and he is most decidedly an insider,” Siegel wrote.

McConnell said the line was poorly constructed by Siegel and meant to point out that his status as an outsider but added, “I would not have allowed him to send that letter with that statement.”


Lobbying Ms. Margaret: The Community

Margaret Gordon, “Ms. Margaret” for short, is a force of nature. The co-director of the West Oakland Environmental Indicator Project has for years highlighted the high incidents of asthma and other respiratory issues associated with truck pollution in West Oakland. She is tough and no-nonsense. She was also viewed as someone Oakland coal needed on its side, or, at least, not totally against it. “Winning over a local activist named Margaret Gordon (“Ms. Margaret”) who is analogous to a local Maxine Waters in terms of being extremely vocal against coal,” Siegel wrote. “She is an African American woman who apparently has a significant amount of clout.”

Siegel believed that the path toward winning over Gordon could go through former Oakland Raiders running back Marshawn Lynch. Perhaps nobody personifies Oakland at this time more than Lynch. “Both Greg McConnell and Marshawn Lynch are close to her so accessing her will not be a problem,” Siegel wrote.

Lynch could not be reached for comment. McConnell said he met with Lynch to discuss the bulk terminal project. “We had a casual lunch. I asked, “Do you think the community would support coal?’ Marshawn did not agree. There was no further contact. He’s just a good guy who cares about the community.” McConnell attributed the mention of Lynch to Siegel, who was a former football player, knowing the connection between Lynch and the city. Siegel and Wolff, however, met with Lynch and his agent, Doug Hendrickson, last March, and again, in April.

McConnell said he met with Gordon to discuss coal. During their conversation, he said they talked generally about the bulk terminal, and that its handling of coal would be safer than any method currently in use. “I feel we had a good conversation,” he added.

It would be the only such meeting with Gordon. “I told them that I was against coal as a commodity,” she said in an interview. She expressed surprise that McConnell believed there was any chance that she could be flipped. After advocating for clean air in West Oakland for 25 years, she said, no one in the community would ever take her seriously again if she suddenly reversed course. “We can’t talk about the future if we allow coal in West Oakland.”

However, Gordon said McConnell was not seeking her total endorsement, just her backing for a proposed compromise to phase out coal shipments over the next two decades. Still, she doubts the issue will be resolved anytime soon. “It’s going to be a continuous fight. Whatever decision is made the other side is going to fight it.”


The Path Forward

To date, there is no evidence that Siegel’s strategy will prevail. Abel Guillen, a former Oakland councilmember who faced the full force of Oakland coal’s lobbying effort before leaving office last December said he doubted the coal’s backers will be able to change the resolve of the current city council.

“This seems like a full court press to try and lobby the new council members by out-of-town interests to bring coal to Oakland,” Guillen said after being provided with Siegel’s memo and travel log. “While it is typical for councilmembers to get lobbied by powerful interests, I think it will be very difficult to flip the council’s position and allow coal to come through Oakland.”

And yet, there’s a good chance the federal judge’s decision in favor of Tagami’s lawsuit will ultimately achieve Siegel’s desired result on its own. 

Coming Next Week: Phil Tagami is Still Fighting

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