Coast reclamation advocates warn fight over how to spend BP fines far from over

25th March 2013   ·   0 Comments

By Bob Marshall
thelensnola.org

As lawyers battle in federal court to determine how many billions in fines BP and its partners owe for damages caused by the 2010 Deepwater Horizon disaster, Louisiana coastal advocates are being urged to get involved in an equally important fight already underway outside the courtroom.

The money will be funneled to the states under the RESTORE Act, passed by Congress in 2011. But the U.S. Departments of Treasury and Commerce are still writing rules of disbursement and definitions of terms that will go a long way in determining where and how that money is used.

Groups who hoped it would primarily be spent on repairing ecological damage to the Gulf may be disappointed in the outcome if they don’t get involved, said Mark Davis, director of the Tulane Institute on Water Resources Law and Policy.

“If anybody thinks passage of the RESTORE Act alone will insure good things will happen and the public interest will be honored, I don’t think that is a safe assumption,” Davis said. “I think the same blend of civic and local interests that stuck their necks out to [pass] this act … will probably have to stay in the game to see it through.”

That a giant food fight would erupt between competing users was virtually promised by the act’s title: RESTORE stands for “Resources and Ecosystem Sustainability, Tourist Opportunities and Revived Economies of the Gulf.”

Louisiana may have wanted the money to help pay the $50 billion bill for its coastal restoration plan, and everyone agrees its coast suffered most from the Deepwater Horizon rig explosion and oil spill, not to mention decades of oil and gas development.

But bringing in a broader constituency was the only way Louisiana could win the support of other Gulf states for a bill that diverts 80 percent of the Clean Water Act fines from their normal resting place in the federal treasury.

Louisiana’s congressional delegation, with help from national environmental groups, fought hard to steer as much of the money as possible to restore damage directly caused by BP, and to general Gulf-wide ecosystem restoration. Other states, which suffered little direct environmental damage from the Deepwater Horizon disaster, saw the bill as windfall that could finance a laundry list of economic and tourism-related initiatives.

The bill that emerged established the Gulf Coast Ecosystem Restoration Council, with representatives from each of the five Gulf states plus the U.S. departments of the Interior, Commerce, Agriculture, and Homeland Security, the Army and the Environmental Protection Agency.

The council is charged with developing a “Comprehensive Plan” for ecosystem and economic recovery, and must approve projects and all expenditures.

But the bill stipulates spending from the total fine be split into five different spending funds, or “pots,” as they are being called:

Pot 1 — 35 percent of the total fine is to be equally divided among the five states for ecological restoration, economic development, and tourism promotion.

Pot 2 — 30 percent, plus interest, for ecosystem restoration,

Pot 3 — 30 percent will be di­vided among the five states to finance projects approved by the Council.

Pot 4 — 2.5 percent, plus interest, will go to the Gulf Coast Ecosystem Restoration Science, Observation, Monitoring and Technology Program within the Department of Commerce’s National Oceanic and Atmospheric Administration.

Pot 5 — 2.5 percent, plus interest, will be allocated to the states to establish “Centers of Excellence” which guide research grants focused on science, technology, and the monitoring of Gulf restoration.

While the allocations to those five pots may be clear enough, much of language describing how and where the money is spent is not, Davis said. At an informational gathering last week of Louisiana groups and government representatives who lobbied successfully for passage of the RESTORE Act, Davis and Garret Graves, head of the state’s Coastal Protection and Restoration Authority, agreed the language left holes “big enough to drive trucks through,” Davis said.

“For example, there is language about funding going to projects in counties or parishes that border the Gulf or have a coastline,” Davis said. “Well, look at New Orleans. It is on an arm of the Gulf — Lake Pontchartrain. Is that a Gulf shoreline? Or does it even border the Gulf?”

And though Louisiana sees Pot-2 money as clearly marked for ecosystem restoration, some of it could be used for other purposes, namely economic projects, Davis warned.

Efforts to divert money from ecosystem repair may also come from within the state, Davis said. Interest groups are likely to push for grants for pet projects and factions in the state Legislature may attempt to “hijack” funding to help solve Louisiana’s budget deficit, he said.

That’s one reason Davis supports a state bill seeking a constitutional amendment that guarantees RESTORE Act funds go to the Coastal Trust Fund.

Davis said the key to delivering what most Restore Act supporters intended — namely, healing the ailing Gulf of Mexico — will largely be determined by two factors:

• rules on disbursement that the Treasury Department comes up with and

• the narrowness with which the Treasury and Commerce departments define various terms in the law.

The reason the law passed with “so much wiggle room,” Davis said, is because it was written by representatives from five different states with different agendas— and was handed off to agencies with no prior experience in dealing with these specific challenges.

“The bill called for Treasury to have its regulations finished in 180 days — which would have been sometime in January — and most of us are glad they didn’t get that done,” Davis said. “It was an impossible job for them. These are people who have no familiarity with the issues involved.

“But that does give us a window of opportunity to get involved in helping shape those regulations and definitions so that they reflect what was clearly the will of the people who wanted to see this whole thing done — namely, helping repair the Gulf.”

Davis urged government as well as non-governmental groups to contact the two agencies to offer their own input, as well as to monitor the on-going process.

“This is history being made, and it’s either going to be made with us or without us,” he said.

“You’re not going to rewrite the bill, but I think the people writing the definitions and rules are amenable to good advice, given in a constructive manner.”

Conflicts and controversies are almost assured, Davis said, “partly because it was a dinner made by a team of chefs, not one chef.

“Someone is going to be unhappy. Instead of sitting and watching this trial and counting the money we haven’t even received yet, I would say our time is better spent helping [the agencies] develop greater (adherence) to the fundamental public purposes this bill was sold on.

“If we don’t, we may well get some nasty surprises.”

This article originally published in the March 25, 2013 print edition of The Louisiana Weekly newspaper.