washington — State and local government officials from across Louisiana headed to Washington this week for Mardi Gras, and the top question they asked of the state’s congressional delegation was “What are we going to do now?”
Parish presidents, police jurors, legislators, bureaucrats, U.S. representatives and U.S. senators, even the governor, put aside partisan feuds and went all out together at Christmas to get the 2022 coastline called RISEE according to the president’s wishes The Economic and Ecosystem Reinvestment Act is on the desk before the 117th Congress expires on December 31.
They failed. Now they are regrouping for another assassination.
RISEE would do many things, but primarily the legislation would remove restrictions on federal payments to states in royalties and fees for offshore energy production. This represents an increase in state government annual revenue of approximately 20%.
Much of the money will go toward coastal restoration, flood protection and improvements to communities impacted by oil and gas production — much of which is currently borne by Louisiana taxpayers or simply left unfinished due to a lack of cash.
RISEE essentially changes the framework detailed in the 2006 Gulf of Mexico Energy Security Act. Under GOMESA, the federal government repatriates 37.5 percent of offshore energy revenues to Louisiana, Texas, Mississippi and Alabama, with a combined annual cap of approximately $375 million.
All payments over the cap go to the federal government. The Land and Water Conservation Fund receives 12.5% of offshore income under GOMESA, with the final 50% going to the US Treasury.
RISEE would remove that cap and expand federal revenue sharing to 38 coastal states, including those along the Great Lakes.
Louisiana’s 2020 cuts under GOMESA are $155.7 million, split equally between state and parish governments. An analysis by the University of Louisiana at Lafayette estimated that without the cap, Louisiana could lose about $1.9 billion, depending on circumstances.
RISEE passed committee last summer with bipartisan support, then stalled pending a vote in the full Senate. Louisiana’s congressional delegation, backed by domestic officials, urged the addition of RISEE to the must-pass year-end omnibus bill that authorizes annual spending by federal government agencies.
They needed the approval of the supreme leader at the time to attach the RISEE language to the omnibus. Senate Majority Leader Chuck Schumer (D-N.Y.) and Minority Leader Sen. Mitch McConnell (R-Kentucky), as well as the two top leaders of the House, House Speaker Nancy Pelosi ( D-Calif.) and House Minority Leader Kevin McCarthy, R-Calif., declined without giving a reason.
People close to the closed-door process speculated that the quartet’s decision was based on opposition and cost.
Strictly speaking, income sharing is not taxation first and then distribution. More of the money companies pay for royalties and fees doesn’t go to the federal coffers, but goes to the states where production takes place. Under RISEE, about $14 billion would be diverted, according to the Congressional Budget Office.
All bills introduced in the 117th Congress expire at the end of the year. Now that the newly elected 118th Congress has been sworn in, Louisiana’s six representatives, two senators and their staffs are beginning “what-if” conversations that lead to piecing together a bill that could convince the majority to pass RISEE or something like it language.
“If our country doesn’t invest in coastal resiliency now, it will spend billions of dollars down the road repairing flood-damaged coastal communities,” said Sen. Sheldon Whitehouse co-sponsored RISEE, Rhode Island.
“My goal in this Congress is to make sure senators and congressmen understand how important this is. Pass it now or pay more later,” Cassidy added.
With Republicans holding a slim majority in the House of Representatives, new legislation to change GOMESA faces a very different picture than last year.
House Republicans, for example, are seeking spending cuts that could take money away from Medicare, Social Security and other social programs.
Congressmen in Louisiana will have to convince most of their colleagues that revenue sharing is a good thing for communities more than 50 miles from the coast.
“Energy production in the Gulf of Mexico is not only critical to America’s national security, but also provides critical funding for restoring Louisiana’s coast,” said House Majority Leader Steve Scalise.
“Throughout my tenure in Congress, I have been pushing for strong energy revenue sharing to eventually achieve parity between Louisiana and the interior states so we have the tools to fund hurricane protection and coastal restoration projects, “He said.
Scalise and US Rep. Troy Carter of New Orleans sponsored the budgeting of renewable electric energy district benefits last year. Take the cap breeze measures also have to start from scratch.
Like RISEE, BREEZE will support the establishment of an offshore wind energy industry. However, instead of keeping the revenue share at 37.5%, BREEZE will increase the states’ revenue share to half of the royalties and fees collected. Another 12.5 percent will go to the U.S. Treasury Department and 37.5 percent will go to the North American Wetlands Conservation Act Fund. NAWCA is the only federal grant program dedicated to protecting wetland habitat for migratory birds.
But Senate Energy and Natural Resources Committee Chairman Joe Manchin of West Virginia and other Senate Democrats who signed RISEE want to keep states at 37.5 percent.
Sen. John N. Kennedy of Louisiana, Madisonville, and the sponsor of a similar 2020 offshore capital parity bill blamed Democrats.
“We fought hard to get the RISEE Act into it, but Republican efforts to get it in the 2023 Omnibus Bill have been frustrated. Now our focus is on moving the ball forward in the new Congress,” Kennedy said Thursday.
Cassidy’s RISEE co-sponsor, Democratic Sen. Whitehouse, wants some of the money to go to the National Ocean and Coastal Safety Fund, not NAWCA. Coast Safety will support research, monitoring and restoration activities in response to rising sea levels and stronger storms due to global warming.
Climate change “poses one of the greatest threats” to the country’s future, Whitehouse said.
Republicans disagree with the level of danger Whitehouse sees and have worked for the past six years to block a regular source of federal money from flowing into coastal safety funds.
Another staunch foe is U.S. Rep. Raúl Manuel Grijalva of Tucson, Ariz., chairman of the House Natural Resources Committee. Generally, the Big Four leaders in Congress want approval from the committees that oversee specific bills being considered for inclusion in the comprehensive spending measure. Grijalva disagrees.
He argues that revenue sharing would incentivize states to allow more oil and gas production, which would further damage the environment. Over the past 15 years, Grijalva has been part of several efforts by Democrats to lower their revenue share with energy-producing states.
On Jan. 10, Republican Rep. Bruce Westerman of Arkansas became the new chairman of the House Natural Resources Committee, which now has more Republicans than Democrats, including Rep. Garret R., Baton Rouge. Graves.
During her 18 years representing Louisiana in the US Senate, Mary Landrieu played an integral role in advancing the passage of GOMESA and blocking efforts to lower federal revenue-sharing rates. She also worked hard to lift the cap. As a lobbyist, Landrieu helped the state organize and implement a strategy to pass RISEE.
“We knew there was a smarter way than sending us relief money after every storm,” Landrieu said in an interview. “How about investing in prevention? How about investing in coastal resiliency and investing in coastal communities where 60 percent of the U.S. population lives?”