Most Recent Action    Action in 106th Congress    Court Decisions    Hearings Summaries 

Update on Outer Continental Shelf Royalties (12-18-00)

Since 1994, the federal government has collected a minimum of $2.6 billion each year from offshore royalties, rents, and bonus bids.  1997 was a record year, bringing in nearly $5.2 billion.  During the 106th Congress, several bills have been introduced that direct portions of this money to the Land and Water Conservation Fund or other projects that purchase land and provide grants to states for conservation projects.  The bills differ in the proportions of outer continental shelf (OCS) revenues allocated and the programs that the funds are directed towards, but they are all based on the notion that funds created by the exploitation of offshore oil and gas should be reinvested in conservation efforts (for an overview of some of these bills as well as a bit of historical perspective on the OCS revenue issue, see the Congressional Research Service reports Outer Continental Shelf:  Oil and Gas Leasing and Revenue and Conserving Land Resources: Legislative Proposals in the 106th Congress).  OCS royalties are also a matter of judicial concern.  A recent Supreme Court decision may impact U.S. oil companies' OCS operations significantly, producing ripple effects throughout the entire industry.

Most Recent Action
The Mineral Management Service (MMS) published in the December 12, 2000, Federal Register a request for comments on the Outer Continental Shelf (OCS) Oil and Gas leasing Program to help develop a new five-year program (2002-2007) and environmental impact statement.  The Federal Register page contains a link for PDF and HTML formatted versions of the announcement that includes contact information and basic background.  Public comment periods are the principal mechanism for federal agencies to receive feedback on draft rules, regulations, and policies before they are put into final form and officially promulgated. It is important that the geoscience community plays a part in the development of policies regarding the nation's outer continental shelf.   The comment period ends on February 1, 2001.

Mail comments and information to: 5-Year Program Manager, Minerals Management Service (MS-4400), Room 2324, 381 Elden Street, Herndon, Virginia 20170. The MMS will accept hand deliveries at 1849 C Street, N.W., Room 4230, Washington, D.C. Please label your comments and the packaging in which they are submitted as to subject matter: mark those pertaining to program preparation, "Comments on Preparation of the 5-Year Program for 2002-2007"; and mark those pertaining to EIS preparation, "Scoping Comments on the EIS for the 5-Year Program for 2002-2007."  If you submit any privileged or proprietary information to be treated as confidential, please mark the envelope, "Contains Confidential Information."   MMS will accept comments submitted by electronic mail. Send your comments on the preparation of the program to MMS5-year.document@mms.gov and your comments concerning the scope of the EIS to MMS5-year.eis@mms.gov. We also will provide access to information concerning the 5-year program and EIS, including copies of comments we receive in response to this notice, at the MMS internet website




Action in 106th Congress
Several bills have been introduced this Congress that would redirect a portion of Outer Continental Shelf (OCS) oil and gas revenues to states and conservation programs.  Currently, these revenues go the federal treasury.  Congress annually authorizes about $900 million of these royalties for the Land and Water Conservation Fund to purchase land and provide grants to states for conservation projects.  Historically, however, Congress has not appropriated that much, providing the fund only $328 million in Fiscal Year 1999 while using the rest for deficit reduction.

Sen. Landrieu's Reinvestment and Environmental Restoration Act of 1999 (S. 25) was one of the first bills introduced in the Senate during the 106th Congress.  The bill was introduced with nine cosponsors, including Senate Energy and Natural Resources Committee Chairman Murkowski and Majority Leader Trent Lott (R-MS).  The bill directs 50 percent of OCS royalties to the national treasury while the other half go to conservation activities and coastal states.  Thirty-four coastal states receive 27 percent of the royalties for OCS impact assistance.  The remainder of the royalties are to be divided among all 50 states: 16 percent would go to the Land and Water Conservation Fund and 7 percent would go to state fish and wildlife conservation programs.  The Senate Energy and Natural Resources Committee held hearings on the bill on January 27 and May 11, 1999.

Rep. George Miller (D-CA) and Sen. Boxer introduced similar legislation on February 23, 1999.  Dubbed "Resources 2000," the bills -- H.R. 798 and S. 446 -- fully fund the Land and Water Conservation Fund and provide $1.4 billion for funds supporting urban parks, land restoration, endangered species recovery, marine habitat and farm/rangeland conservation.  In a San Francisco Chronicle op-ed, Boxer and Miller said that they "believe momentum is building in Congress and across the nation to finally commit ourselves to the permanent protection of America's natural heritage"

Another set of companion bills has been introduced to permanently fund the Land and Water Conservation Fund at its authorized level of $900 million.  They provide 50 % for federal land acquisition, 40 % for states, and 10 % for grants to local governments under the Urban Park and Recreation Recovery Program.  The proposed legislation was introduced as S. 532 by Senator Dianne Feinstein (D-CA) and as H.R. 1118 by Rep. Tom Campbell (R-CA).

On August 5, 1999, the House Subcommittee on Energy & Mineral Resources held its first hearing on H.R. 33,  a measure which imposes certain requirements on leasing lands off the Florida coasts under the Outer Continental Shelf Lands Act. Rep. Porter Goss (R-FL), author of H.R. 33, told the subcommittee that the bill will increase the role of science in OCS decision making, involve state governments to a greater extent, and provide a permanent solution to problems caused by offshore drilling.  Industry and Mineral Management Service representatives testified in opposition to the bill, raising a number of concerns.  Primarily, they argued that the current process is working and that H.R. 33 would only make the situation worse.

On May 24, 2000, the Senate Environment and Public Works Committee held a hearing on CARA, reviewing Sen. Mary Landrieu's (D-LA) companion bill, S. 2123, as well as Sen. Jeff Bingaman's (D-NM) S. 2181, a bill purported to spread OCS funds more evenly across the fifty states.  Sen. Landrieu's S. 25, which provides a formula for the use of OCS funds in conservation programs, was also considered.  Many of those present praised the legislation, alternatively labeling it "an historic opportunity . . . to create a lasting conservation legacy" and the "most important and historic conservation legislation to come before this Congress." While nearly all of those present supported the legislation in principle, however, a few expressed reservations about CARA's funding mechanisms.  Some feared that a new government trust fund would erode Congress' ability to appropriate while others stated that CARA fails to address maintenance issues on public lands.  Many who opposed the bill did so because they feared an encroachment on private property rights.  "While CARA is being established under the guise of 'environment' and 'conservation,'" Rep. Helen Chenoweth-Hage (R-ID) warned, "its true premise has more to do with who will own and control property in the United States of America."

Although Sen. Landrieu's S. 2123 emerged from the hearing as the consensus CARA measure, it did not incorporate some of the changes the committee made to the Senate's CARA bills.  In S. 2567, however, Sen. Boxer addressed these changes, removing a controversial provision that some groups say would have "encouraged states to allow more drilling to get more money." Although Boxer's bill could go directly to the Senate floor, ensuring consideration in case the Energy and Natural Resources Committee fails to act on it before the end of session, such a move is unlikely.

The Senate Energy and Natural Resources Committee passed an amended version of the House's Conservation and Reinvestment Act (CARA) July 25th in a 13-7 vote.  Four Republicans (Sen. Gordon Smith (R-OR), Sen. Peter Fitzgerald (R-IL), Sen. Frank Murkowski (R-AK), and Sen. Jim Bunning (R-KY)) joined committee democrats in supporting the measure, which was introduced by Committee Chairman Murkowski and Ranking Member Jeff Bingaman (D-NM).  The Senate legislation supplies nearly $3 billion in OCS oil and gas revenues to a host of conservation programs for each of the next 15 years, $450 million of which is to go to federal land acquisition under the Land and Water Conservation Fund (LWCF).  If Congress fails to appropriate the full $450 million for this purpose in a given fiscal year, then none of the other conservation programs will be funded that year.  While a host of amendments were proposed during the five-day markup of the Murkowski - Bingaman measure, only two passed.  Sen. Larry Craig's (R-ID) amendment states that the federal government is not entitled to water rights in the areas it acquires while Sen. Byron Dorgan's (D-ND) measure gives the U.S. Fish and Wildlife Service four years to map the conservation easements it acquired prior to a 1976 law that required such documentation.

Understandably, some celebrated the bill's passage while others bemoaned it.  The National Wildlife Federation's President and CEO Mark Van Putten joined other environmental groups in praising the legislation, labeling the Senate decision "a breakthrough vote that sets the stage for Congress to enact the most significant conservation funding legislation in the nation's history."  Supporters also noted that CARA fully funds the payment in lieu of taxes (PILT) account for counties with federal lands.  Promises of full PILT funding did little, however, to assuage others who feared that CARA would pull money away from other needy areas.  Private property rights groups also objected to increased federal land ownership.

Early this June, Sen. Barbara Boxer (D-CA) introduced S. 2567, a measure designed to appropriate $2.8 billion in OCS royalties for coastal restoration, wildlife recovery, and parkland renewal accounts.  In many ways, this bill is similar to the House's CARA measure (H.R. 701). Passed by the House in a 315-102 vote May 11th, H.R. 701 establishes an "Outer Continental Shelf Impact Assistance Fund (OCSIAF) to provide impact assistance to coastal states from a portion (27 percent) of allocatable [sic] new OCS revenues (some $2.8 billion received by the United States as royalties, net profit share payments, and related late payment interest from natural gas and oil leases under the Outer Continental Shelf Lands Act)."  $900 million would go to the Land and Water Conservation Fund (LWCF) while the remainder of the OCS revenues would be distributed throughout the nation on wildlife preservation, urban parks, historic places, and Indian lands accounts.

More Outer Continental Shelf bills submitted during the 106th Congress are listed below:

S. 819  The National Park Preservation Act.  S. 819 was introduced by Sen. Bob Graham (D-FL) on April 15, 1999.  The bill was promptly referred to the Senate Committee on Energy and Natural Resources, which held hearings on it during April and May 1999.  Sen. Graham's bill funds the National Park System through OCS revenues.  A portion of this funding ($500 million) goes to national parks "that have ecosystems, critical habitat, cultural resources or other core park resources that are threatened or impaired."  Of this $500 million, $150 million per year is earmarked for water restoration projects in the Everglades and other parts of South Florida through FY 2015.

S. 924  The Federal Royalty Certainty Act.  S. 924 was introduced by Sen. Don Nickles (R-OK) on April 29, 1999.  Unlike other OCS bills, S. 924 focuses on the manner in which federal oil and gas royalties are collected rather than how the money is spent.  A summary of Royalty Issues, as well as links to hearings regarding S. 924, is available on AGI's oil royalty and valuation update webpage.

S. 1573  Natural Resources Reinvestment Act of 1999.  Introduced on September 9, 1999, by Sen. Joe Lieberman (D-CT), S. 1573 distributes OCS revenues more evenly across the fifty states.  Unlike other OCS proposals, Sen. Lieberman's bill puts $900 million toward establishing a new Environmental Stewardship Fund.  This fund would support state efforts to improve air and water quality, conserve habitat, remediate brownfields, and otherwise enhance the local environment.  Participating states must match 30 % of federal expenditures.  While the Senate Energy and Natural Resources Committee has not acted on Sen. Lieberman's legislation, staffers noted that some of S. 1573's provisions may be included in a compromise CARA measure.




In the Courts
In its July 26th edition, the Washington Post reports that the production subsidiaries of Chevron Corp., Conoco Inc., and Murphy Oil Corp. have sued the federal government over an offshore lease dispute.  The companies accuse the government of creating regulatory roadblocks that prevent them from developing gas reserves on leases they purchased nearly two decades ago for the Eastern Gulf's Destin Dome.  Coming just one month after a Supreme Court decision in a similar case, their lawsuit reportedly calls the situation a "regulatory Catch-22" that amounts to a breach of contract and unconstitutional seizure of property.

On June 26th, the U.S. Supreme Court ruled in Mobil Oil Exploration & Producing Southeast, Inc. v. United States that the federal government must pay Mobil Oil and Marathon, Inc. $156 million for offshore oil and natural gas lease contracts that they purchased in 1981.  Mobil and Marathon paid that amount for lease contracts giving them the right to explore and develop oil reserves off the North Carolina coast.  These contracts were contingent upon environmental approval.  Soon after the purchase, however, Congress passed the Outer Banks Protection Act, prohibiting the Department of the Interior from approving either company's "plan of exploration" (such plans are required for a company to begin oil exploration) while it set up further obstacles to the two companies' plans for offshore oil exploration and drilling.  Frustrated, the oil companies sued the federal government for breach of contract.  This week, eight of the Supreme Court's nine justices agreed that the oil companies' rights had been violated, stating "We agree that the government broke its promise; it repudiated the contracts; and it must give the companies their money back."

Oil companies quickly embraced the high court's verdict as a victory for the industry.  "There are a number of existing leases that have had the rules changed on them," an oil exploration industry representative claimed, so the court's ruling could be a boon for many firms.  Nowhere may this week's ruling be felt more than the Gulf of Mexico.  Since the early 1980s, this representative asserted, the Department of the Interior has been unable to use any of its funding for new leases in the eastern gulf because it was banned from doing so in its annual appropriations.  With 8,000 oil production, drilling, and exploration leases currently in operation there, the high court's ruling is bound to have a substantial impact. Currently, about 30 percent of domestically produced natural gas as well as 22 percent of U.S. crude oil come from OCS production. (6-28-00)


Congressional Hearings


Senate Energy and Natural Resources Committee
January 27, 1999

The Senate Energy and Natural Resources Committee held a hearing on S. 25 on January 27, 1999. A rather surreal mood pervaded the hearing, as it ended early for members of both parties to attend caucus meetings to discuss the pending impeachment trial. A bit of bipartisanship prevailed, however, as members from both sides of the aisle praised the bill. Committee Chairman Murkowski said that the bill "invests money from nonrenewable resources in renewables" and that the local governments -- not the federal government -- will decide how to spend the money. Sen. Landrieu stated that "there is no greater environmental issue ... than our nation's coastlines." She continued by saying that "the federal government needs to be a more reliable partner to manage our resources and coastlines." She said Louisiana has produced most of the $120 billion in royalties that OCS drilling has provided since 1955 and the state needs some of that money back to address the environmental effects of drilling, especially wetlands loss.

The witnesses at the hearing were:  James Palmer, Director of the Mississippi Department of Environmental Quality; Jack Caldwell, Secretary of the Louisiana Department of Natural Resources; Jim Whitaker, Alaska House of Representatives; Don Oltz, State Geologist of Alabama; and Mark Van Putten, President and CEO of the National Wildlife Federation.

Palmer provided a history of similar legislation and urged Congress to "pass the legislation and don't wait!" Caldwell painted a grim picture of the environment in Louisiana, saying that it is in "a state of collapse." He said that Louisiana has lost 1,000 square miles of coastline -- an area the size of Delaware -- and is continuing to lose land and infrastructure. Whitaker voiced his support for the bill, emphasizing that Alaska is another important source of oil where local communities absorb the risks of this production, but do not receive the benefits. Oltz focused his remarks on the infrastructure needs of Alabama -- needs that result from the state's natural gas production. He mentioned possible future problems with boat and air traffic, air quality, and oil spills. Van Putten was the principal witness raising concerns with the bill's language, noting that petroleum is toxic to living organisms and nearly impossible to contain. Van Putten did, however, acknowledge that "S. 25 provides an important opportunity to redirect revenue to address the impacts." He emphasized that the bill should not contain incentives to encourage additional drilling. During the Question and Answer session, Murkowski reminded Van Putten that "you can't bite the hand that feeds you," noting that strong OCS revenues are needed for this program to work.

During the hearing, Sen. Landrieu noted that the Administration has not come out in support of S. 25. The Administration has instead focused its energies on a somewhat similar project, the "Lands Legacy Initiative." This $1 billion project, released as part of the President's FY2000 budget, would fully fund the Land and Water Conservation Fund for federal land acquisitions as well as state and local government conservation efforts. President Clinton has indicated that he will work with Congress to "create a permanent funding stream beginning in 2001." Both projects do, however, aim to use OCS revenues to mitigate environmental impacts, establishing a bit of common ground on some normally contentious environmental issues.


Senate Energy and Natural Resources Committee
May 11, 1999

George Frampton, acting chair of the Council on Environmental Quality (CEQ), was the sole witness at this hearing, the focus of which oscillated between LWCF bills and slamming the CEQ. On the former topic, Senator Bingaman said that it is important that the country use this money for an "asset of lasting value," adding that LWCF monies should not be used for operational or maintenance costs. Senator Landrieu focused her opening remarks on the Administration's Lands Legacy Initiative. Although she supports its underlying principle, she believes it falls short because it does not create a permanent funding source for the LWCF. In addition, Senator Landrieu is concerned that the initiative restricts the use of money for land acquisition and does not place enough emphasis on coastal states.

Mr. Frampton testified that he was not endorsing or opposing any of the bills before the committee. Instead, he wants to work with Congress to find common ground on this issue in order to take advantage of this "historic opportunity to create a permanent funding mechanism." He emphasized that the Administration has not put forward a bill, but rather a list of principles that should be included in a bill. The FY2000 proposal does not represent an "inflexible indication of permanent funding" but indicates the limits of a balanced budget.

Frampton testified that the Administration has several problems with S.25, Sen. Landrieu's Reinvestment and Environmental Restoration Act.  Namely, he said that he was concerned that it restricts the federal side of the LWCF; he opposes the use of block grants. Finally, he worried that it would provide incentives for additional offshore drilling. During a series of question and answers with Senator Landrieu, he clarified that the Administration wants the LWCF to be neutral with respect to drilling -- providing no incentives for new drilling -- but the Administration continues to support drilling with environmental considerations.


Legislative Hearing on H.R. 33, A Bill Imposing Certain Restrictions and Requirements on the Leasing Under the Outer Continental Shelf Lands Act of Lands Offshore Florida, and For Other Purposes
House Subcommittee on Energy & Mineral Resources
August 5, 1999

This Hearing's Bottom Line
This was the subcommittee's first hearing on H.R. 33, although it has held hearings on this issue several times in the past.  Rep. Porter Goss (R-FL), author of H.R. 33, told the subcommittee that the bill will increase the roll of science in OCS decision making, involve state governments to a greater extent, and provide a permanent solution.  Industry and Mineral Management Service representatives testified in opposition to the bill, raising a number of concerns.  Primarily, they argued that the current process is working.  H.R. 33, they said, would only make the situation worse.

Opening Statements
Rep. Barbara Cubin (R-WY), subcommittee chair, noted in her opening statement that Rep. Goss has introduced this piece of legislation to several Congresses.  She then summarized the main objectives of H.R. 33.  Cubin said the bill would establish a joint federal-state task force and mandate preparation of assessments, studies and research which would be reviewed by the task force before the Secretary of the Interior "may carry out his responsibilities under the OCSLA [Outer Continental Shelf Lands Act] regarding oil and gas leasing offshore of the State of Florida."

"[T]he issue boils down to just how much deference, if any, the feds should give to the Governor of a state on OCS leasing decisions off that state's shoreline," Cubin said.  "I'd like to support even partial devolution of authority to coast state governors participating in federal OCS decision-making," she added, "but I see very little reciprocity of this thinking when it comes to empowering my Governor to be an equal partner with the feds when it comes to shaping grazing, timber, mining, oil and gas and other public land policies in Wyoming."  Cubin went on to imply that the Secretary of the Interior is more attentive to mineral resource issues in OCS areas than in her home state of Wyoming, because the dollar value of OCS resources is so much greater.  "My constituents need to know that decisions we make here in Congress affecting this rather substantial revenue stream are soundly supported by objective science," Cubin concluded.

Panel I
Rep. Porter Goss (R-FL)
Mike Joyner, Director of Legislative and Governmental Affairs, Florida Department of
    Environmental Protection

Rep. Goss testified in support of the legislation he has crafted.  He told the subcommittee that passing yearly moratoriums on OCS leasing, as Congress has done since 1983, "was never intended to be a long term solution."  Although the moratorium enjoys enormous support, Goss said "it fails to satisfy the interests of both parties to this debate."  He testified that H.R. 33 has been endorsed by Florida Governor Jeb Bush, former Governor Lawton Chiles, and the entire Florida Congressional Delegation while it enjoys wide support from the state's private and public sector.

Goss summarized his bill, stating that "Once the joint task force determines that an adequate base of data exists, it would recommend what areas (if any) off Florida could safely sustain oil and gas exploration and production."  He said his approach will ensure that decisions made "accurately reflect scientific rather than political pressures," give state officials a "central role" in the decision making process, and develop a more permanent and precise policy.

Finally, Goss addressed general concerns that have been raised over H.R. 33.  He said the task force would include one representative from the Environmental Protection Agency, the Minerals Management Service, the National Oceanic and Atmospheric Administration, and the U.S. Fish and Wildlife Service; four representatives from Florida to be appointed by the Governor, and three professional scientists from the fields of physical oceanography, marine ecology and social science.  He said he would be happy to discuss reconsidering the task force's makeup.

Mr. Joyner also testified in support of H.R. 33.  He said scientific studies are needed to address the likelihood of oil spills and "other long-term and cumulative environmental and social effects" from offshore drilling.  Research topics would include "physical disturbances caused by anchoring, pipeline placement and rig construction; the resuspension of bottom sediments; chronic pollution from discharges of drilling effluents, production effluents, and accidental releases of other toxic materials; social and economic impacts; and endangered and threatened species."  Joyner stated that "It is premature to consider further exploration or precedent setting development and production in this undeveloped area until adequate environmental studies are completed, and a better understanding of environmental risks is known."  He noted that H.R. 33 would block OCS leasing until the Mineral Management Service has an opportunity to address concerns raised by the State of Florida and the National Academy of Sciences.

During questioning, Cubin remarked that she was "totally committed to the idea that states" have a role in the use of federal property within their borders.  She questioned, however, whether scientific research would change how the public perceives the issue, especially if studies found the danger level to be lower than expected.  She agreed that decisions "should be based on fact, not the psychology of the audience."

Rep. Robert Underwood (D-GU), the subcommittee's ranking democrat, asked Rep. Goss why a yearly moratorium is not a sufficient solution.  "The moratorium just keeps pushing the decision down the road," he said.  "What if, some year, someone forgets the appropriations rider?"  Goss added that executive orders are a high risk solution because they "come and go with Presidents."

Rep. Chris John (D-LA) asked if the witnesses expect scientific data to "reveal vast differences" in different areas.  Both witnesses said that is highly probable, and, as a result, neither favors a "one size fits all" policy.  They also told the representative there is a real need for "one basic, credible group to give data" that all parties involved can agree upon and then take that data to public meetings.

Rep. Cubin commented upon the need for socioeconomic studies in addition to, or as part of, environmental impact studies.  "If it's right for Florida, it's right for the rest of us," she said.  Rep. Jay Inslee (D-WA) asked Joyner if his department engages in global climate change studies, Joyner said it does.

Panel II
Walt Rosenbusch, Director, Mineral Management Service, U.S. Department of the Interior
Jay Hakes, Administrator, Energy Information Administration, U.S. Department of Energy

Mr. Rosenbusch reviewed the work of the Mineral Management Service over the past eight years.  Of H.R. 33 he said, "While we appreciate the intent of the legislation, we believe that the current consultative and environmental processes already in place -- along with the Administration's willingness to listen carefully to its stakeholders and make decisions based on good science -- are the best way to proceed with the OCS program."  Rosenbusch emphasized that the current OCS five-year program will not end until 2002, that the program is "consensus-based," and that state governments agreed to the plan.  He added that a presidential directive prohibits leasing in some areas off Florida's shores until at least 2012.

Rosenbusch cautioned that the drilling moratorium provided for in H.R. 33 "could have severe economic implications on leases and operators and could very likely set the stage for litigation for a potential buyback of those leases. . . .  [T]he potential liability to the American taxpayer could be substantial."  Rosenbusch also found fault with the bill's non-government employed peer-review requirement.  He said the "NRC strongly emphasized that MMS should use the OCS Advisory Board Scientific Committee for advice on environmental research" and that another layer of peer-review is unnecessary.  Rosenbusch concluded that if enacted, H.R. 33 could also lead to endless scientific studies and no decision making.

Mr. Hakes told the subcommittee that electricity demand is expected to increase in Florida at the average rate of 2.2 percent per year through 2005.  He said that although Florida "produces a very limited amount of crude oil and natural gas," it is one of the top four states in the residential, commercial and transportation sectors.

In response to questions from Cubin and Underwood, Rosenbusch told the subcommittee that $76 million has already been spent on OCS studies.  He said H.R. 33 "would impede the process that we currently have in place . . . [and] delay dialog with the states until enough information was available to make environmentally sound decisions."  Rosenbusch said he would rather see that dialog continue while research is underway.  Rep. Cubin then explored the possibility of building a pipeline from Wyoming to Florida to provide natural gas to meet the growing electricity demand.  This idea provoked little response from the witnesses.

Panel III
Charles A. Bedell, Murphy Exploration & Production Company; National Ocean Industries
    Association; American Petroleum Institute; U.S. Oil and Gas Association; Independent
    Petroleum Association of America; Domestic Petroleum Council; and International Association
    of Drilling Contractors

Mr. Bedell testified in opposition to H.R. 33.  He told the subcommittee that "Compared to sound science and the operating history of the offshore industry, the doomsday fears and contentions of the activist community are not the appropriate basis for highly restrictive legislation, like H.R. 33."  He reminded the members that oil and gas is brought to the United States travels via tank vessels, which also pose a threat to the environment.  He asserted that "A balance must be struck, but by prohibiting domestic oil and gas production in federal waters off the coast of Florida, this bill may actually increase the risk of damage to Florida's coastline!"

Bedell praised the work of MMS.  He stated that present laws and regulations are working well and that giving states the power to determine when "adequate environmental analysis" has been completed is both unnecessary and counterproductive.  He also said the phrase "minimal level of uncertainty" would encourage litigation.  "In fact," he said, "under the present law and regulations there is a more than sufficient level of scientific information to document the impacts of OCS activities."  He concluded that H.R. 33 would "mandate an unending process in which no amount of time and money spent on scientific and environmental studies would ever be deemed adequate by those who are philosophically and politically against energy development."  Bedell urged the committee to reject H.R. 33 because he does not believe it will lead to any real solution.  He noted that MMS is increasingly involved in public education.

Cubin asked Bedell about socioeconomic studies.  Bedell said these are already part of MMS' efforts and that all concerns raised have already been addressed.


  Hearing on Conservation and Reinvestment Act bills (CARA) - S. 25, S. 2123, S. 2181
Senate Environment and Public Works Committee
May 24, 2000

If the volume of statements generated at a hearing is any indication of an issue's political temperature, then the CARA legislation placed before the Senate Environment and Public Works Committee May 24 is quite hot.  Twenty-three witnesses either testified or submitted statements for the record after no less than eleven senators issued opening statements.  Although most of those present supported CARA legislation (at least in principle), a vocal minority vehemently objected to its provisions.  Moreover, many of those testifying in favor of the legislation voiced concerns about some of the act's specific provisions.

Rep. Don Young (R-AK), Sen. Mary Landrieu (D-LA), and Rep. George Miller (R-CA), all CARA sponsors, praised the legislation's bipartisan backing.  Young noted that 4,576 organizations have pledged their support for CARA while Landrieu cited her 19 co-sponsors as proof positive that the legislation enjoys broad support in the Senate.  Predictably, all of the witnesses testifying on behalf of environmental organizations praised CARA in turn, with many offering additional suggestions for improvement.  David Waller, President of the International Association of Fish and Wildlife Agencies and Director of the Georgia Wildlife Resources Division, Wayne Vetter, Executive Director of the New Hampshire Fish and Game Department, and Thomas M. Franklin, Wildlife Policy Director for The Wildlife Society, all advocated a more equitable distribution of funds for small states.  Bobby Whitefeather, speaking on behalf of the Chippewa Tribal Council's Red Lake Band, pushed for more conservation funding efforts on reservations while Rindy O'Brien, Vice President of Policy for The Wilderness Society, hoped to make the Land and Water Conservation Fund (LWCF) a government trust fund, thereby removing it from the vicissitudes of the annual appropriations process.  Jamie Clark, Director of the U.S. Fish and Wildlife Service, added that the Clinton Administration wants CARA passed quickly.

Other witnesses lined up against CARA, portraying it as a massive government land grab that tramples private property rights.  Speaking on behalf of 700 New Hampshire pulp and paper millworkers, Ted Miller, Local 75 - PACE International Union, characterized CARA as a significant government advance in its continuing "war" on rural Americans.  From the 1989 spotted owl controversy to the recent Los Alamos fires, Miller portrayed a federal government unconcerned with those rural residents who have to contend with its persistent mismanagement.  The American Land Rights Association's Mike Hardiman added that CARA is really a pork package for Louisiana and Alaska disguised as conservation legislation.  While the average state would receive $11 per person per year under CARA, Hardiman asserted, Louisiana would receive $71 and Alaska a whopping $266.  Lest anyone claim that most of the nation supports CARA, Chuck Cushman, Coordinator for the Keep Private Lands in Private Hands Coalition, noted that over 600 citizens' groups back his group's opposition to the legislation.  Ray Kreig of Anchorage, Alaska, added that several studies have also cast doubt on CARA, perhaps lending credence to the claims of Rep. Helen Chenoweth-Hage (R-ID), Sen. James Inhofe (R-OK) and others that CARA does, in fact, trample on private property rights. He specifically cited studies by the Heritage Foundation, Stewards of the Range, and the Political Economy Research Center. Other members expressed concern over the creation of a trust fund independent of the congressional appropriations process as well as current government mismanagement of federal lands.


Sources:  Energy and Environment News, Greenwire, Senate Energy and Natural Resources Committee website, Supreme Court website, Senate Environment and Public Works Committee website, Senate Energy and Natural Resources Committee website, Environmental and Energy Study Institute Weekly Bulletin, and NASULGC.

Please send any comments or requests for information to the AGI Government Affairs Program.

Contributed by Kasey Shewey White and Margaret Baker, AGI Government Affairs, 1999 AGI/AIPG Geoscience and Public Policy Intern Althea Cawley-Murphree, 1999-2000 AGI/AAPG Geoscience Policy Intern Alison Alcott, and 2000 AGI/AIPG Geoscience and Public Policy Intern Michael Wagg

Last updated December 18, 2000


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