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In quaint Avila Beach Calif, oil firm plans resort where crude once spilled

Diesel fuel, gasoline and crude, it turned out, had been saturating the soil under the town and its quaint beach for years. Public health advocates and the state accused Unocal of spilling toxic substances into a source of drinking water.
Unocal signed one of largest environmental settlements in California history: an agreement to cleanse Avila Beach.......

The project is seen by many as inevitable — even, potentially, transformative. But bitterness from 'the trauma' lingers for some.

AVILA BEACH, Calif. — Pretty regularly, the clouds cartwheel in from the sea and sock everybody in around here, except tiny Avila Beach. It'll be dreary up in Morro Bay and dreadful down in Pismo, but here, the hills cut through the fog and leave a little circle of sunshine. It's a microclimate, technically. But locals like to think of it as a halo.

Things often seem to just happen here, whether it's a feeding frenzy of humpback whales in the bay or a nude volleyball game over at Pirate's Cove. It had been a charmed Central Coast existence, with one disastrous exception: a massive leak from an oil tank farm that sent 400,000 gallons of petrochemicals oozing under the town.

This was not just any oil spill — it was an underground lake of muck that built up over decades, polluting Avila Beach so severely before it was discovered in 1989 that the town had to be destroyed, effectively, to be saved.

Much of Avila Beach, including its entire business district, had to be torn down and reconstructed, its iconoclastic, working-class character, many believe, lost in a thicket of bulldozers, lawyers and regulators.
Today, a final chapter to that saga is underway: An oil company wants to build a resort on the very piece of land where the spill originated.

The development is viewed by many area officials as an inevitability — even, potentially, a transformative addition, one that would mark the opening of a spectacular seaside property to the public for the first time in a century.

But among some of the salty old guard in Avila Beach, word of the resort proposal has been sobering — as if the bitterness associated with "the trauma," as one official called it, was always just a shovelful away, like the crude oil that once permeated the dirt.

"Whoever's got the billions and the trillions always gets the last laugh, right?" said Michael Reichman, who was born here in 1962. Reichman sipped his coffee with a friend the other morning at Avila Grocery & Deli, a Front Street pillar. "It's a joke."

In 1906, Union Oil Co. built the oil tank farm on 95 acres just south of San Luis Obispo. By World War II, 2 million gallons of crude oil a day was being pumped from huge storage vats into tankers in the bay. The pipes went right under Front Street.

In 1989, a man was working on his basement when he struck oil.

Diesel fuel, gasoline and crude, it turned out, had been saturating the soil under the town and its quaint beach for years. Public health advocates and the state accused Unocal of spilling toxic substances into a source of drinking water.

Unocal signed one of largest environmental settlements in California history: an agreement to cleanse Avila Beach that cost the company as much as $200 million, the equivalent of half a million dollars for each of the town's 400 residents.

It was a terrible slog. Bulldozers removed about 300,000 cubic yards of earth, sometimes digging 15 feet deep in the heart of town to excise the last of the pollutants. Commerce ground to a halt. Many residents were displaced; some were given a check for their pain and inconvenience and never came back.
"We kind of miss the old town," said Mike Cullen, 65, who lived and owned businesses here for more than three decades, and now visits from his home in Oahu with his dog, Buddy Blue VI. "The whole thing just got erased."

The town was rebuilt as something different — more tourist-friendly, a little less dive bar, a little more wine and cheese. Many see it as a nicer, more welcoming place.

"It was, quite frankly, an eyesore," said Rick Cohen, executive director of the Avila Beach Community Foundation. The agency dispenses at least $60,000 each year in community-building grants financed, still, through the Unocal settlement. "Now it's beautiful."

"But there is an acceptance that it is a different kind of town," said San Luis Obispo County Supervisor Adam Hill, whose district includes Avila Beach. "You can't reconstruct funky."

Chevron Corp. bought Unocal in 2005, acquiring both the legacy of the oil tank farm and the majesty of the bluff, which is now wiped clean of the massive storage containers.

Talk of redevelopment has been percolating for years, but it is suddenly getting serious; Chevron was recently granted permission from the county to take the first substantive step, changing the zoning of the land.
Many people in town want the fenced-off property essentially opened up but undeveloped — a notion summarized nicely by Reichman, who said he'd like to see "a bitchin' park for the people, for the public.",0,3426108.story#axzz2kG3UQB33
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