Out of state contractors may not be a good neighbor in Benicia and Solano County by the end of 2004 at the Valero Refinery.

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Oakland, CA October 19, 2004– Bricklayers and Allied Craftworkers Local 3, representing the northern 46 counties in California, have been investigating business practices by Diamond Refractory Services at the Valero refinery in an effort to express their concerns that Diamond Refractory Services does not meet area wage and benefit standards, and indirectly use local taxpayers to subsidize operations. The Valero refinery in Benicia is located in an area between East 2nd street and Bayshore road near the Interstate 780 and 680 interchange.

On September 23, 2004 the Bricklayers and Allied Craftworkers (BAC) Local 3 of Northern California sent a letter to Altair Strickland requesting answers as to why they chose to utilize Diamond Refractory services to perform work at the Valero Benicia Refinery instead of utilizing local contractors that support the community and pay area standard wages and benefits.

On October 1, 2004 BAC Local 3 sent a certified return receipt (7002 2030 0006 9569 3039) letter to Diamond Refractory Services responsible managing officers that stated picketing would commence to protest the failure to pay area standard wages and benefits. To date the BAC Local 3 has not received any response from either Diamond or Altair Strickland to deny the failure to pay area wages and benefit standards - except attempts by Valero management to keep quiet on this matter. After receiving no response, the BAC Local 3 commenced picketing of Diamond Refractory Services at the Valero refinery on October 8, 2004 at 6:00 am to protest the disregard for local wage and benefit standards.

On October 8, 2004 Chris Howe of Valero stated to KTVU news reporters that Valero would coordinate a meeting between BAC Local 3 and the subcontractor [Diamond Refractory Services]. To date, no meeting has been coordinated.

According to reports in the October 9, 2004 Times-Herald for Benicia, Vallejo and American Canyon, an estimated “600 bricklayers, engineers and other trade workers didn’t show up for work…” Further, it seems that Valero does not care about community standards as they were quoted as saying,” contractor Altair Strickland and its subcontractor Diamond Refractory Services use non-union workers. But what kind of workers the firms hire is their business…This is between Diamond and the union, not over Valero," Howe said. "Valero is a neutral party in this.” This statement seems to be in contradiction to the “Good Neighbor Policy” between Valero and the city of Benicia. (A copy of the policy is available through city sources.) Valero is the owner of the project and should be more active in protecting the community, instead of allowing the disregard of the wage and benefit standards.

On October 13, 2004, the BAC Local 3 sent a letter via fax (210-345-2646), email (corporatecommunications at valero.com) and USPS to Bill Greehey, CEO of Valero, concerning the lack of involvement and requested input in solving this problem in a timely manner at a local level.

When out of state contractors fail to provide area wages and benefits to their employees, it creates a burden on local taxpayers. When an uninsured person is injured, they are sent to the County Hospital for treatment. Additionally, some of these people fail to register their out of state vehicles; do not have adequate auto insurance for the state of California; do not have required emission controls (smog); and do not obtain a California driver license as required by law. This means that local taxpayers end up subsidizing out of state contractors and receive no additional benefits from the increased profits of the contractors. Failure to meet local emission standards seems to be in violation of the Air Quality section of the Mitigation Monitoring and Reporting Program (MMRP) for ensuring the effective implementation of the mitigation measures required for City of Benicia approval of a Use Permit for Valero Benicia Refinery’s Valero Improvement Project (VIP). This may have significant air quality implications over the proposed six (6) year project.

As published from the Associated Press on September 7, 2004:

“Oil refiner Valero Energy Corp. said Tuesday it expects to post record earnings for the third quarter in the range of $2.50 per share despite a recent decline in gasoline margins.

While the estimate is 67 percent above last year's third-quarter earnings of $1.50 per share, it was well below analyst estimates for earnings of $2.81 per share, according to Thomson First Call.

"Though somewhat lower than we had originally anticipated for the third quarter, this level of earnings would be outstanding and continues to demonstrate Valero's strong earnings power," said Valero chairman and chief executive Bill Greehey in a statement. "Even with the recent decline in gasoline margins, this is still expected to be a record quarter for us."

The company said that low distillate inventories, above-normal turnaround activity and discounts on sour crude oil, should contribute to a strong fourth quarter.”

Diamond Refractory Services is a Texas based refractory contractor operating under the license of Altair Strickland. Diamond Refractory does not possess a valid C-29 license as required by the State of California to perform this work. Diamond is, instead, working as a subcontractor under and "A" engineering license held by Altair Strickland. Altair Strickland is also based in Texas. There are highly qualified, properly licensed, local based contractors capable of performing this work.

Additionally, hundreds (800 estimated) of workers from other states have recently taken classes from the Bay Area Training Corporation (BATC), which is a requirement to work in the refineries in the San Francisco Bay Area. It seems Diamond Refractory Services and Altair Strickland have visions of obtaining more work in this area by utilizing out of state contractors that will displace the local citizens and businesses that support our communities. Money paid to out of state contractors will most undoubtedly be sent out of state. It is estimated the amount of work to be performed on the catalytic cracker turnaround will require approximately 20,000 hours of labor or $1.2 million in compensation to Diamond Refractory workers. According to the Valero Improvement Project EIR of 2002 (Table 3-1), initial installation of optimizing and supporting components will start around the end of 2004 following the major turnaround. The Valero Improvement Project is an estimated 6-year project to improve and expand the Valero Refinery.

Bricklayers and Allied Craftworkers represent Bricklayers/Stonemasons, Tile Layers and Finishers, Pointer Cleaner Caulkers, Marble Setters and Finishers, Terrazzo Mechanics and Finishers, and Refractory Bricklayers who work various aspects of the industry in the Northern 46 counties of California. Refractory Bricklayers line the boilers, benzene tanks, acid tanks, and catalytic crackers. This is one of the most dangerous jobs in the world and poses the greatest health risk to Refractory Bricklayers. They work in one of the most carcinogenic environments in the world. They were recently tested for silicosis and asbestos, and many of the members have tested positive for early stages. They are proud of the work they do and have no complaints. They are hard working and diligent in their craft.


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James C Bresnahan
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