House and Senate approve. Hooray for evil republicans and traitor democrats!
Congress approves offshore oil revenue sharing
By Bill Walsh
Washington bureau
WASHINGTON ? On the cusp of adjournment, Congress passed catch-all legislation early today that created for the first time a permanent source of federal financing to repair Louisiana?s eroding coastline and shore up its hurricane defenses.
The Senate vote today represented the capstone of generations? worth of lobbying by Louisiana lawmakers ever since the state in 1949 thumbed its nose at President Truman when he offered a 37.5 percent cut of offshore oil and gas royalties. The state?s gambit back then for more money failed and since has cost Louisiana tens of billions of dollars.
As it turned out, the deal approved by Congress after a marathon day of negotiations Friday would steer the same percentage to four Gulf Coast states from newly authorized offshore energy drilling. For Louisiana, it is projected to mean $200 million through 2017 and some $650 million annually thereafter as revenue sharing expands throughout the Gulf of Mexico.
?The Truman offer has finally been accepted for Louisiana and the Gulf states,? said Sen. Mary Landrieu, D-La., who has pushed for a share of federal energy royalties since she came to the Senate a decade ago. ?It is the cornerstone that has been laid down to protect and rebuild the Gulf coast.?
Just as Louisiana has been counting on a steady flow of federal money to repair an estimated $14 billion in coastal damage ? and several times more in storm- and flood-protection needs exposed by Hurricane Katrina ? Landrieu saw in the legislation the path toward political salvation.
Elected twice by narrow margins, she faces re-election in 2008 with a political base dispersed throughout the country after last year?s back-to-back hurricanes. The revenue-sharing success gives her a solid campaign platform from which to make a bid for a third term.
What Congress approved was a $45 billion package that extended a host of popular tax deductions, health care protections for low-income people, a preservation of fees for Medicare doctors as well as the expanded drilling and revenue-sharing provisions for the Gulf Coast. The most controversial item was an international trade package liberalizing relations with Haiti, Vietnam, and African and Andean nations.
Senate approval of the overall bill was seriously threatened by objections from textile-state senators who feared a flood of cheap foreign goods and the loss of local manufacturing jobs. Among those most worried were Louisiana fishers and shrimpers who have long complained about the glut of low-cost Vietnamese product flowing into the domestic seafood market.
?I?ve looked at these trade provisions very, very carefully, particularly with regard to Louisiana fishermen?s concerns about Vietnam,? Sen. David Vitter, R-La., said in a statement. ?Although I understand their very strong concerns, I?ve decided that both of these trade initiatives are, on balance, good for America and Louisiana.?
Had the free-trade opponents prevailed, the overall legislation ? including the revenue-sharing provisions ? would also have died as the House left for the year and the Senate prepared to close the books on the 109th Congress.
That drilling measure calls for the opening of 8.3 million acres in the eastern Gulf of Mexico that has been off limits to energy exploration. Four coastal states will share in the bids companies make to acquire the new leases and then enjoy a 37.5 percent share of the royalties they pay on the oil and gas they extract.
Earlier this year, Louisiana amended its Constitution to earmark its share for coastal and wetlands restoration. Despite the promised protections, the bill was fiercely opposed by environmental groups who said conservation shouldn?t be tied to expanded offshore oil and gas drilling.
The erosion of the state?s coast, partly through decades of offshore drilling activity and partly through other man-made hazards, has left Louisiana increasingly vulnerable to the deadly storms that swirl every hurricane season in the Gulf of Mexico. Hurricane Katrina, only a moderate storm when it came ashore 14 months ago, showed just how exposed the region is and helped focus national attention on the state?s efforts to erect a coastal buffer.
Markey?s maneuver
Weeks of delicate negotiations came close to unraveling Friday afternoon in the House when Rep. Edward Markey, D-Mass., launched an offensive against the legislation, saying that four states didn?t deserve to share in revenue from property owned by all Americans. Standing in front of a U.S. map, with 46 states shaded red and four coastal states colored suggestively green, Markey said, ?If you are one of the other 46 states, you should hang your head in shame.?
In a clever political maneuver, Markey offered a hard-to-oppose amendment that would force energy companies to pay tens of billions dollars in disputed royalties dating from the late 1990s or face a ban on drilling in the Gulf. The amendment also would protect millions of middle-class Americans from being hit with the Alternative Minimum Tax, an enticing offer that Markey practically dared his colleagues to vote against.
But Republican leaders and Gulf state lawmakers, including Reps. Bobby Jindal, R-Kenner, and Charlie Melancon, D-Napoleonville, leaned on their colleagues to resist voting for the amendment knowing that the Senate had insisted on a bill free of alterations, no matter how politically satisfying. Markey?s amendment lost, 205-207.
?Today is a historic victory for Louisiana?s future,? Melancon said.
?We cleared a major obstacle, which was a poison pill amendment, in getting this done,? Jindal said. ?I think we?ve got the hard work about done.?
Among dozens of other things, the House-passed measure would:
Direct 12.5 percent of new Gulf offshore royalties to the Land and Water Conservation Fund, which pays for parks and other public open spaces.
Extend until 2010 a Katrina-related tax incentive designed to encourage businesses to invest in the hurricane-damaged Gulf Coast. The cost would be $465 million over 10 years. Businesses could be allowed to depreciate 50 percent of their capital costs in a single year, although some local officials were upset that eight Louisiana parishes were excluded.
