A planned U.S. Senate bill to increase the amount of federal offshore oil revenue shared with to Louisiana and other Gulf Coast states, and to set up a similar revenue sharing program for wind energy generated in federal waters, got a vote of support from the Louisiana Coastal Protection and Restoration Authority. The proposed Reinvesting in America’s Shoreline Economies and Ecosystems Act would fulfill promises that Sens. Bill Cassidy, R-La., and Sheldon Whitehouse, D-R.I., made last summer to expand revenue sharing for coastal states under the Gulf of Mexico Energy Security Act when it became clear that such an expansion would not be included in the wildly popular Great American Outdoors Act. The senators have not yet introduced the revenue sharing bill. The outdoors act diverts a greater share of outer continental shelf energy revenue – mostly from Gulf of Mexico oil and gas production – to guarantee $900 million a year for improvements to national and local parks and wildlife refuges. It also provides $11.9 billion over five years to chip away at an enormous backlog of deferred maintenance on public lands.nola.com
The State receives 37% of the revenue from oil wells drilled since 2017 and a lesser percent for earlier ones. The Louisiana Constitution says these monies must be used for coastal levees or restoration efforts.
The proposed changes, according to the coastal authority’s letter, would give Louisiana and other Gulf states the same 37 percent of federal revenue from all wells developed since 2000 – a major expansion in the revenue available. The legislation also would end total revenue sharing caps that represented $487.5 million for fiscal 2020 and 2021 and would be $375 million for 2022 through 2055. Under present law, the caps don’t end until 2056. In 2020, the law split about $353 million in federal offshore revenue among Louisiana, Texas, Mississippi and Alabama. Florida does not share in the revenue as no oil and gas production is allowed in its federal waters. Louisiana received $155.7 million of the total, of which $124.6 million went to the state government. The remainder was split among 19 coastal parishes.
These monies are one of the few recurring sources for coastal renovation.
TIn the letter, coastal chairman Chip Kline said the Gulf of Mexico Energy Security Act money is one of Louisiana’s few recurring sources of revenue for major coastal restoration and hurricane levee projects. In fiscal 2022, Louisiana plans to spend almost $900 million on 110 restoration and levee projects, with much of the money coming from either this law or revenue streams associated with the 2010 BP Deepwater Horizon oil disaster. he planned Shorelines Economies and Ecosystems Act “would provide a mechanism for us to do more to protect and restore coastal Louisiana, both short and long term,” Kline said. Adding revenue from offshore wind energy development would help diversify the revenue streams for those projects, he said. The planned Shorelines Economies and Ecosystems Act “would provide a mechanism for us to do more to protect and restore coastal Louisiana, both short and long term,” Kline said. Adding revenue from offshore wind energy development would help diversify the revenue streams for those projects, he said.
This money can also be used to repay the $1 Billion dollars borrowed to rebuild the New Orleans levee system after Hurricane Katrina in 2005.