Legislators, healthcare and business groups decry gas moratorium

Shoppers pass by the yet-to-open Northeast Valley Health Corp. clinic in Newhall. The clinic is scheduled to open next month, but a proposed moratorium on natural gas hookups may delay the opening. Andrew Clark/The Signal

The Northeast Valley Health Corp. is facing an unexpected hurdle in opening their Newhall clinic next month: no natural gas.

The community health center’s leadership was one of several legislators, as well as health care, city and business officials, to speak out against a proposed moratorium on new natural gas connections by the California Public Utilities Commission.

“When I received the letter from The Gas Company with this moratorium, it created a lot of uncertainty for Northeast Valley in terms of our opening date and how it might impact us,” said Theresa Nitescu, COO of the health corporation. “We really need to open this health center.”

The CPUC said the moratorium would affect new commercial and industrial connections in areas of Los Angeles County that would rely on natural gas from Aliso Canyon, the site of the 2015 natural gas leak.

“The moratorium is designed to enhance natural gas reliability to core and noncore customers during the winter heating season and thereby preserve public health and safety,” the resolution calling for the moratorium said.

The moratorium was initially going to be voted on this week and go into effect until March 31, but a vote on the moratorium was delayed until a Feb. 8 hearing in San Francisco.

“The moratorium would help avoid increased demand for natural gas by new commercial and industrial customers until such time as the CPUC is assured by SoCalGas that there is adequate capacity in the system to meet foreseeable need,” the commission said in announcing the proposal.

Nitescu said the group is one of the largest community health centers in the nation with existing offices in Canyon Country and Valencia, as well as the San Fernando Valley. The agency provides health care to needy families, she said.

“Many of our patients live below the federal poverty level,” she said. “In Santa Clarita Valley in particular, we serve over 17,000 patients and we’ve performed 50,000 visits in this valley last year.”

However, the new clinic on the corner of Orchard Village Road and Lyons Avenue, complete with 14 exam rooms, would be subject to the moratorium and could have its opening delayed until later this year.

“This is going to be a big impact in terms of bringing primary care access to this valley,” Nitescu said, adding that patients had already been scheduled for check-ups at the new facility and jobs offered.

Nitescu said she notified Henry Mayo Newhall Hospital President and Chief Executive Officer Roger Seaver about the moratorium impacting her clinic. The hospital is also against the moratorium as it completes construction on a new $151 million patient tower that Seaver said is “desperately needed.”

“This is a problem I couldn’t have imagined entering our community at this time,” he said.

Seaver said the clinic is being partially funded by Henry Mayo and philanthropic agencies. He said the clinic has gone through a multiyear planning and approval process before being effectively told to wait by the public utilities commission.

“‘Hold it, we’re not sure you should open it.’ I mean, that’s really the message,” he said.

As for Henry Mayo’s expansion, Seaver called it the cornerstone of the hospital’s master plan.

“We will finish the construction this calendar year,” he said. “To open the facility, we have to have gas. Gas is the source of energy for almost everything going on in the hospital.”

Mayor Pro Tem Marsha McLean urged the city to write a letter against the moratorium to legislators during a city council meeting Tuesday night.

“You can imagine how this is detrimental to businesses and devastating to our own hospital,” she said of the proposed moratorium.

Assemblyman Dante Acosta, R-Santa Clarita, called the proposed moratorium a “foolish decision” that “boggles my mind.”

“The CPUC really should be taking a good hard look before they leap to such drastic actions that could have dire consequences for our region,” he said. “Even the gas company has said this moratorium is unnecessary. It will give no perceived benefit, it will not increase reliability.”

Hilary Norton, chair-elect of the BizFed, said more than 400 businesses, employees and residents have signed the group’s petition against the moratorium. She said the moratorium would impact 700 public and private projects in the closing stages of development.

“A preliminary analysis released by the Los Angeles Economic Development Corporation finds that the proposed moratorium if enacted would have significant impacts including nearly 5,200 fewer total jobs would be created, $879.5 million lost in future economic output, roughly $324 million lost in future labor earnings, and almost $120 million lost in future federal, state and local tax revenues,” she said. “A moratorium like this is not the way to address energy reliability.”

A Jan. 4 letter by state Sen. Scott Wilk, R-Santa Clarita, to the public utilities commission said the moratorium would have unintended consequences.

“This proposal will hurt businesses who rely on natural gas for operations as wide and varied as manufacturing, cooking and computer coding,” he wrote. “This measure will lead to real people losing real jobs, small business owners shuttering windows, entrepreneurs giving up.”

Los Angeles County Business Federation Founding Chair David Fleming likened the proposed moratorium to closing gas stations on the Gulf Coast after the Deepwater Horizon oil leak in 2010.

“This moratorium makes about as much sense as after the oil spill in the Gulf, closing all the gasoline stations in the whole southern United States,” he said. “That’s exactly what it amounts to. You don’t solve the problem by stopping the hookups of people who need natural gas, particularly for those things that are so job-dependent.”

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