The City of Carson has reached a landmark $370 million settlement with Tesoro/Marathon Petroleum, securing significant immediate and long-term funding for the community while strengthening the City's financial position without imposing a new tax on Carson residents.
Under the agreement, Carson will receive $120 million upfront and $250 million over 15 years, providing both immediate funding and a predictable long-term revenue stream of approximately $16.67 million annually beginning in January 2027. This structured payout ensures the city can plan for future needs while addressing current challenges.
The settlement also allows Carson to withdraw its proposed oil refinery tax measure from the November 2026 ballot. Tesoro/Marathon will continue paying the City's existing Measure C Oil Industry Business License Tax, with no credit against the settlement payments. This ensures ongoing revenue from the oil industry remains intact.
The agreement ends years of litigation between the city and the oil company. Tesoro/Marathon will seek dismissal of the tax litigation and will not pursue attorney fees or litigation costs from the City. This resolution removes legal uncertainty and allows both parties to move forward.
Settlement proceeds will go through Carson's public budgeting process, with infrastructure and deferred maintenance already identified as potential priorities. This means residents will see tangible benefits from the funds, which could improve roads, public facilities, and other essential services.
The settlement is a major win for Carson, as it bolsters the city's finances without burdening taxpayers. By securing a steady revenue stream, Carson can invest in its vision of being 'a thriving, diverse, destination city - a great place to live, work and play with an unlimited future.'
City officials have emphasized that the agreement reflects a collaborative effort to resolve disputes while prioritizing the community's well-being. The predictable annual payments will enable long-term planning and fiscal stability, reducing the need for future tax increases or service cuts.
This development is particularly significant given the financial pressures many California cities face. Carson's ability to secure such a substantial settlement demonstrates effective negotiation and strategic management of city resources.
Residents can expect to see the first annual payment of approximately $16.67 million in January 2027, with subsequent payments over the next 15 years. This long-term commitment from Tesoro/Marathon underscores the company's willingness to invest in the community's future.
As the city moves forward, the settlement will allow Carson to address deferred maintenance and infrastructure needs, which are critical for maintaining quality of life and supporting economic growth. The funds will be allocated through the public budgeting process, ensuring transparency and community input.
In summary, the $370 million settlement with Tesoro/Marathon is a transformative agreement for Carson, providing financial security, ending litigation, and paving the way for community investments without raising taxes.
