Cassidy Statement on Obama’s Proposed Budget, GOMESA Raid
WASHINGTON – U.S. Senator Bill Cassidy, M.D. (R-LA) released the following statement on the president’s budget proposal for the 2017 fiscal year, including his proposal to repeal GOMESA (Gulf of Mexico Energy Security Act):
“The president throws out a variety of proposals designed to please his base. His advisers know and admit these proposals have no chance of becoming law. We need a serious conversation about energy policy and transportation.
“It’s no surprise the president wants to deprive Louisiana of funding that was promised to our state through GOMESA for coastal restoration projects—funding that is critical to protecting families from future storms like Hurricane Katrina. I’d like to remind the president that the Senate Appropriations Committee finances the budget and the Senate Energy and Natural Resources Committee has oversight over any changes to GOMESA. I will do everything in my power to use my seat on these committees to not only block the president's raid on oil and gas revenues, but fight to increase Louisiana's share of offshore revenue. Funding for coastal restoration must remain a promise to Louisiana and other Gulf Coast states. Protecting Louisiana jobs and our energy economy is and will continue to be my priority.”
Under GOMESA, Gulf Coast states are expected to receive $375 million—about $176 million for Louisiana – annually. In Louisiana, all revenue is constitutionally dedicated to coastal restoration projects. The Gulf Coast is expected to receive $3.7 billion in revenue derived from offshore energy production over the next 10 years, and more than $13 billion throughout the next 35 years. GOMESA’s passage received bi-partisan support with over 70 U.S. Senators voting in the affirmative in 2006.
Royalties to states from energy produced offshore is a fraction of what states that produce energy onshore receive. In fiscal year 2014, the federal government received $4.6 billion in royalties from crude oil production in the Gulf of Mexico, while the coastal states who supply the energy infrastructure only received $3.4 million—.07 percent in royalties. In comparison, states who produce energy onshore get 50 percent of the royalties.
Sen. Cassidy has been fighting to protect this funding and also increase it- he offered a bipartisan amendment to the Senate Energy bill to provide greater equity in revenue sharing for states that host offshore energy production by lifting the GOMESA revenue sharing cap for Louisiana, Texas, Mississippi, and Alabama, from $500 million to $999 million from 2027 to 2031. It is estimated that Gulf States would receive an additional $1.87 billion. Read more about the amendment here.
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