Thursday PM September 24th, 2009
by: Ed Mayberry, September 24, 2009 3:09:32 pm
A federal agency says Imperial Sugar and managers at its Georgia refinery ignored known dangers of explosive dust for decades before a 2008 explosion killed 14 workers. The U.S. Chemical Safety Board released results of its investigation. It finds that the company likely could have prevented the deaths with routine housekeeping at the plant near Savannah. The agency says internal memos at the refinery contained warnings about dust written in the 1960s. The report says the initial explosion came from a conveyor belt used to move sugar that had a steel cover that trapped dust until it exploded like gunpowder. The agency says the first blast kicked up sugar dust coating other areas, causing secondary explosions that likely killed the employees. Imperial Sugar is based in Sugar Land.
The city of Houston has selected NRG Energy to develop, own and operate the largest solar project in Texas. The city council must approve the agreement. The proposed project will have the capacity to generate ten megawatts of power, to be purchased by the city. That’s just over six per cent of the city’s annual consumption, equivalent to energy required to power over 7,000 homes. It would come online in the second quarter of 2010, creating about 100 jobs during construction. It will be at NRG’s T.H. Wharton Electrical Generating Station in northwest Houston.
British oil giant BP wants more time to implement new safety requirements at its Texas City refinery. That's where a 2005 explosion left 15 people dead. BP's request comes after the U.S. Occupational Safety and Health Administration told it last month that it was failing to make the improvements part of a deal BP made with the agency after the deadly blast. That blast also injured more than 170 people. The agency found BP committed more than 300 willful violations. BP agreed to review process safety management systems and equipment throughout the refinery and pay a $21.3 million fine. BP had until Wednesday to comply with the agreement. OSHA spokeswoman Diana Petterson said the agency had received a request from the company for more time. Petterson declined to say how much additional time BP wants.
Houston janitors marched in downtown Houston this afternoon, ending at Jones Plaza, in advance of wage negotiations. After striking in 2006, Houston janitors gained wage increases and vacation time, as well as access to a primary-care physician. The coordinator for the Justice for Janitors campaign, Beverly Ortiz, says landlord associations haven’t been allowing janitors to talk with the union.
“They’re not allowing the access, yes. In one of the Web sites that they have, they’ve actually given folks tips on how to make sure that the union organizers—member organizers, as well—not be able to access the building, so, to be able to talk to our members.”
Houston business and elected leaders generally supported the collective bargaining agreement emerging from the strike that provided wage increases to $7.75 an hour. That agreement expires in November.
Retail gasoline prices across Texas slipped a penny this week. AAA Texas reported the average price per gallon at the pump was $2.34. Nationally, gasoline prices declined by two cents, to reach $2.53. Houston had the cheapest gasoline in Texas, at $2.28 a gallon. El Paso had the most expensive gasoline, at $2.43. AAA Texas notes the peak summer driving season is over and the gasoline market has entered what has traditionally been a period of weak demand.
Home re-sales dipped last month after a four-month streak of gains, providing evidence that the housing market recovery remains fragile. The National Association of Realtors says sales dropped 2.7 per cent to a seasonally adjusted annual rate of 5.1 million in August, from a pace of 5.24 million in July. Sales had been expected to rise to an annual pace of 5.35 million, according to economists surveyed by Thomson Reuters. Lawrence Yun, the trade group's chief economist, said the drop may reflect delays in completing sales due to tough lending standards and new rules for appraisals. The median sales price was $177,700, down 12.5 per cent from $203,200 in the same month last year.
The number of newly laid-off workers seeking unemployment benefits fell for the third straight week, evidence that layoffs are continuing to ease. The Labor Department says initial claims for unemployment insurance dropped to a seasonally adjusted 530,000 from an upwardly revised 551,000 the previous week. Wall Street economists expected claims to rise by 5,000, according to a survey by Thomson Reuters. The four-week average, which smooths out fluctuations, dropped to 553,500. That's the lowest since late January, though still far above the 325,000 weekly claims typical in a healthy economy. The number of people continuing to claim benefits for more than a week dropped 123,000 to a seasonally adjusted 6.14 million.
The Treasury Department official in charge of overseeing the government's $700 billion bank bailout program says the nation's economic recovery has just begun and that “we still have work to do.” Herbert Allison, the department's Assistant Secretary for Financial Stability, said the nation has a long way to go before a true recovery takes hold. His remarks, included in prepared testimony for a hearing before the Senate Banking Committee, suggest that the administration is in no hurry to let the bailout program expire at the end of the year. The Treasury Department has the option of extending the program to October 2010 so long as it provides a justification to Congress.
Former Federal Reserve Chairman Paul Volcker says the Obama administration's proposed overhaul of financial rules preserve the policy of “too big to fail,” and could lead to future bailouts. Volcker says that by designating some companies as critical to the broader financial system, the proposals create an expectation that those firms enjoy government backing in tough times. He says that implies those financial companies “`will be sheltered by access to a federal safety net.” In testimony prepared for the House Financial Services Committee, Volcker endorses a stricter separation between banks that hold deposits and investment banks. The House committee is leading the effort to pass Obama's financial overhaul.
Even as it noted the economic recovery, the Federal Reserve decided to extend a program intended to lower mortgage rates and prop up the housing market. Even so, rates on home loans are expected to remain low. With the economy on the mend, the Fed said it now plans to reach its goal of buying nearly $1.5 trillion in mortgage-backed securities and debt by the end of March, rather than by the end of this year as originally scheduled. It's the second time since August that the Fed has opted to slow emergency programs designed to encourage spending and boost the economy. In a far brighter assessment, Fed policymakers said: “economic activity has picked up following its severe downturn.” In August, policymakers had observed that economic activity was “leveling out.”
The Federal Reserve is further scaling back two emergency lending programs as the economy improves. The Fed will reduce the amount of money available to banks in short-term loans under a program called the term auction facility. For 84-day loans, the Fed will provide a total of $50 billion in loans in October, and $25 billion each in November and December. For 28-day loans, the Fed will continue to make $75 billion available monthly through January. The Fed also is cutting back on a program where investment firms can temporarily swap risky securities for super-safe treasury securities. The Fed says $50 billion worth of treasury securities will be made available for October, down from the current $75 billion. Operations in November and December will be trimmed to $25 billion each.
The Securities and Exchange Commission says it has charged an employee of a Perot Systems affiliate with insider trading related to the Dell offer to buy Perot Systems this week. In a complaint filed in a Dallas federal court, the SEC says it has charged 53-year-old Reza Saleh. The complaint says he reaped about $8.6 million in “illicit profits.” It alleges the profits result from his knowledge of “material, non-public information that he learned in the course of his employment with, or duties for, two Perot-related private companies and Perot Systems.” The SEC is seeking a court order to freeze Saleh's assets. Saleh works for ParkCentral Capital Management, Plano-based investment firm of former presidential candidate and Perot Systems Chairman Emeritus Ross Perot. Saleh also works for Perot Investments, which manages Rross' personal financial affairs, and has sometimes attended Perot Systems planning meetings, according to the complaint.
Some legislators are urging Texas Comptroller Susan Combs to abandon a plan to cut refunds to those who invested in a state prepaid college tuition program. But Comptroller spokesman R.J. DeSilva said the board has no plans to change its May decision. With the rise in college tuition and other factors, the panel took the step to keep the fund solvent. DeSilva tells the Fort Worth Star-Telegram, “the reason behind the rule change has not changed.” After October 30th, people who paid into the Texas guaranteed tuition plan will receive only the money they put into the plan if they request a refund. They will not get any earnings, no matter how long their money had been invested. Fees will be deducted from their refund.