Valero refinery shutdown in Benicia raises economic concerns, mixed reactions

By Da Lin

The planned shutdown of the Valero refinery in Benicia is expected to have a major economic impact on the city, even as environmental advocates welcome the closure.

Valero has notified the Bay Area Air District that beginning on Saturday, it will shut down some refinery equipment as part of a phased process. A full shutdown of refinery operations is expected by April.

For longtime residents, the news is emotional. Jeff Burkhart, who has lived in Benicia for 30 years, said the closure will be felt throughout the community.

“It’s a sad day.  It’s a sad day for our city and our neighbors, having to get new jobs in other places and so forth. It’s going to affect the economy,” Burkhart said.

The refinery’s closure hits close to home for Burkhart. His son-in-law works for Valero and will leave the company at the end of February.

“I hate to see them go. I’m sure it’s going to affect a lot of our services and parks,” he said.

According to Mayor Steve Young, Valero is Benicia’s largest private employer, with about 420 full-time workers. The company also brings in hundreds of outside workers each year for maintenance projects, providing a boost to the local economy.

“Hotels and restaurants that have benefited from Valero’s presence here, as well as a number of nonprofits and community sports teams and the like, who got donations from Valero over the years,” Young said.

The mayor said the financial consequences for the city will be significant. The refinery shutdown is expected to cost Benicia about $7.7 million each year, about 12% of the city’s $60 million general fund. City leaders are now considering budget cuts, with few areas off-limits.

“These are discussions that we’re going to have to have with the community, with the labor groups, with the employees and with the rest of the council,” Young said.

While the economic fallout is expected to be severe, environmentalists have welcomed the closure, citing the refinery’s history of air quality violations. Mayor Young acknowledged potential public health benefits.

“We will have less asthma, we will have less respiratory diseases, likely, at least that’s what the data shows,” he said.

For many residents, the refinery has long represented a complicated tradeoff — economic stability versus environmental concerns.

“Short-term, we’re going to have some bumps in the road, for sure. But long-term, the things that make Benicia great are still here, our location, our small town atmosphere, the people who are here,” Young said.

Burkhart agrees and remains hopeful about the city’s future.

“I just hope everything will be okay. I just feel certain that we’ll be able to weather the storm,” he said.

Valero and the governor’s office announced in early January that once refinery operations fully shut down, part of the facility will be used to store refined gasoline imported from outside the Bay Area. However, questions remain about how much fuel will be stored and for how long. Officials said the storage facility is not expected to generate many jobs.