Air District Board Digs Into $476.6M Budget, Refinery Revenue Risks

The Bay Area Air Quality Management District (BAAQMD) Board of Directors held its first public hearing on a proposed $476.6 million budget for fiscal year 2026-2027, a spending plan that channels $98 million in penalty-derived funds to pollution-impacted communities and bankrolls a push to clear a chronic permit backlog. No vote was taken — that comes June 3 — but board members used the hearing to press staff hard on whether the district's finances can withstand refinery closures, rising costs, and an expenditure trajectory growing three times faster than revenue.

• $476.6M proposed budget splits $270.8M for general operations and $205.8M for grant and incentive programs, with no new positions added

• Permit processing up 20% year over year, but board members demand faster progress and training that makes staff "solution oriented" for companies from Tesla to refineries

• Expenditures outpacing revenue 3-to-1 over five years sparks calls for contingency planning and scenario modeling before June adoption

• Valero refinery in Benicia stops refining crude oil, plans marine terminal conversion — district already under-recovers $500,000 annually at the facility

• Board directs staff to bring back top-customer revenue breakdowns, year-over-year trend data, and range-of-scenarios analysis for June 3 adoption hearing