Congressman and Illinois Lawmakers, Urge Chicago to Accept Venezuela’s Discounted CITGO Diesel Offer

U.S. Congressman Luis Gutierrez and Illinois Lawmakers urged the City of Chicago to accept Venezuela's offer of discounted diesel for the city's buses. Chicago's transit chief said Chicago cannot accept it as their buses cannot use CITGO's diesel.

Chicago Jan 4, 2006.- U.S. Congressman Luis Gutierrez, Chicago Aldermen Billy Ocasio, Ed Smith, State Representatives Cynthia Soto, Marlow Colvin and Larry McKeon, along with other 20 organized labor leaders and community activists, joined forces today to urge the Chicago Transit Authority (CTA) to reconsider an offer by CITGO Petroleum Corporation to provide the city with discounted diesel fuel for its public buses.

Venezuelan government officials and representatives from CITGO, a subsidiary of Venezuela’s state oil company PDVSA, met with Chicago officials last October to offer diesel fuel at a 40% discount for the city public buses, on the condition that the savings are passed on to riders.

Two months after the offer, Chicago’s Transit Authority, has not provided CITGO or Venezuelan government officials any feedback on the offer in spite of a transportation budget deficit of 17 million for fiscal year 2006 due to high fuel costs. Instead, as of January 1, 2006, bus fares paid in cash increased by 25 cents to 2 dollars, and transfer tickets now cost 2 dollars more if paid with cash.

It is unknown if the refusal to accept the offer comes from CTA Commissioner Frank Kruesi or from Mayor Richard Daley directly, but almost all of those who participated in the press conference, including State representatives Cynthia Soto, Marlow Colvin and Larry McKeon, blamed Kruesi.

CITGO proposed a 40 percent discount on 7.2 million gallons of diesel fuel which could save the city approximately $15 million, according to a press release by Congressman Gutierrez.

The proposal to provide discounted oil products to poor communities in the U.S. was initially proposed by Venezuelan President Hugo Chavez, during his September visit to New York for a United Nations General Assembly meeting, weeks after hurricane Katrina left thousands of poor U.S. residents without assistance from U.S. federal and local authorities.

New York City and Massachusetts are already taking advantage of discounted CITGO heating oil for low-income families, and Maine, Vermont Rode Island, Delaware, Connecticut and Pennsylvania are currently in talks with CITGO and Venezuelan officials regarding similar offers.

"If other major cities are working with CITGO to reduce the strain of skyrocketing energy prices this winter, why is the CTA leaving Chicago out in the cold," added Gutierrez. "This proposal represents millions of dollars that can be used to help shore up the CTA’s finances and to assist low-income riders. It is that simple."

"Instead of starting this New Year off with millions of dollars in savings on fuel expenses that could go toward helping the city’s cash-strapped public transportation systems get its finances in order, the CTA has instead asked riders to bear the brunt of its poor fiscal management by raising cash fares and eliminating cash transfers," Gutierrez said.

"When we are repeatedly warned of doomsday scenarios, major service cuts and employee layoffs, how could the CTA outright reject an offer that could infuse millions of badly needed dollars into its operating budget. The public deserves an explanation," he added.

Alderman Billy Ocasio, who asked CITGO to offer diesel fuel to Chicago instead of the heating oil offered to other cities, said the CITGO proposal will ensure that the CTA remains an affordable option for those who need it most. "The CTA Board has repeatedly cried out for help and is in no position to turn down what amounts to $15 million in assistance; it must, therefore, reconsider CITGO’s generous offer," Ocasio said.

CTA Commissioner Frank Kruesi later held a press conference arguing that CITGO’s fuel would not work in CTA buses, and suggested CITGO could buy 15 million dollars in fare cards and distribute it them to Chicagoans. Kruesi also cited state laws, and CITGO’s alleged demand that free fare cards are provided to poor riders, as reasons that would prevent Chicago from accepting the offer.

However, State Representatives at their press conference earlier, had said that state laws such as the Metropolitan Transit Authority Act, could be modified if it indeed prevents Chicago from buying cheaper diesel fuel for its buses. They said that fare card demands from CITGO and city contract issues have never come up in discussions on the offer.

Alderman Billy Ocasio said that the type of diesel is not an issue as CITGO has offered to obtain it from other companies in a procedure know as swap, in case it does not produce it in their Lemont, Illinois refinery.

A CTA spokesperson told the local Chicago WBBM radio station that Kruesi believed dealings with CITGO would be "inappropriate" given the tensions between the U.S. and the Venezuelan governments. Today Kruesi said Chicago should not interfere in U.S. foreign policy. "We are not in the business of operating a separate foreign policy from the U.S. government, and I have no intention of beginning such a process," he said.

However, State Department spokesperson Adam Ereli provided no objections to the CITGO’s offers at a Dec 8 briefing.

U.S. Energy Secretary Samuel Bodman also said that the U.S. government has no problems with Venezuela’s offer. "We view it, as corporate philanthropy. We’re all for that. Nobody in the Energy Department, or in the government for that matter, is going oppose that. If that’s what Mr. Chavez and his colleagues who own CITGO choose to do, I’m certainly not going to criticize," Bodman told CNN last Dec. 9.

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