AP Wire

White House: Scrap drilling revenue sharing with Gulf states

by Cain Burdeau, Associated Press

Photo by Walter Siegmund/Wikimedia

NEW ORLEANS (AP) — Louisiana's U.S. senators and environmental groups are blasting the White House for proposing to help Alaska deal with rising seas by taking money away from similar efforts along the Gulf Coast.

In its proposed budget for 2017, the White House said Tuesday that it wanted to repeal a 2006 provision that establishes a formula for sharing revenues from offshore drilling in the Gulf of Mexico with four Gulf states.

The vast majority of those revenues now go to the federal government, but starting next year Louisiana, Alabama, Mississippi and Texas are slated to begin receiving a large portion of those funds, estimated at about $375 million with Louisiana getting the lion's share at $176 million a year. Those funds are designed to go toward coastal restoration for states supporting offshore drilling.

The funds are central to plans for restoration in Louisiana, where land loss is a crisis. The state has lost about 1,900 square miles of coast since the 1930s and continues to lose about 17 square miles a year.

In its new budget proposal, the White House called for "repealing" those payments, saying they were "unnecessary and costly." The White House also questioned revenue sharing because the payments go to a "handful of states."

The White House proposal faces stiff opposition in the Republican-controlled Congress, and the likelihood of success appears small. Louisiana's senators have even proposed raising the amount Gulf states get.

President Barack Obama's administration proposed scrapping revenue sharing last year, too, but the effort failed.

This year, the White House said it wants to set up a $400 million program to help "vulnerable Alaskan communities, including relocation expenses for Alaska Native villages threatened by rising seas, coastal erosion, and storm surges." Those funds would be part of a larger program to help coastal communities around the nation "adapt to climate change," the White House said.

The proposal was swiftly blasted by Republican U.S. Sens. David Vitter and Bill Cassidy of Louisiana and by U.S. Sen. Lisa Murkowski and U.S. Rep. Don Young, both Republicans from Alaska.

"The President's budget calls this funding unnecessary — which is a complete insult," Vitter said in a statement Wednesday. "Maybe he needs to get down and see our disappearing coasts, before he talks about eliminating the funds to restore them. Fortunately, the proposal will die an immediate death."

Murkowski said in a news release that she wanted to help Alaskan communities, but not "by depriving other states of money they currently rely upon for their budgets." She said efforts to help Alaska's coastal communities should be paid for by increasing domestic energy production.

Environmental groups also came out against the proposal.

"It's basically robbing Peter to pay Paul," said Elizabeth Weiner, an ecosystems senior policy manager at the Environmental Defense Fund. She said Louisiana has a good plan in place to stem land loss and that the offshore revenues are critically needed.

"The Administration is strongly committed to supporting American coastal communities — from the Gulf of Mexico to the Alaskan North Slope — as they face the real and urgent threats posed by climate change," the Obama administration said in an emailed statement late Wednesday.

Revenue sharing was part of the Gulf of Mexico Energy Security Act, a bill that passed after catastrophic damage from Hurricane Katrina in 2005. Revenues from offshore drilling are an important part of the federal budget, and damage by Katrina played a big role in getting the federal government to give up a chunk of those revenues.