Constitutional Limits on Louisiana Oil Spill Money Fails

Attempts to limit Gulf Coast oil spill penalty money to coastal restoration in the Louisiana Constitution failed to gain legislative passage for a second year, while disagreements continue over just how tightly the dollars should be restricted.

Rep. Simone Champagne, R-Erath, says she wants to make sure the billions of dollars that Louisiana will receive because of the ecological damage from the 2010 BP oil spill can’t be diverted to fill budget gaps.

“I’ll continue trying to make sure that we protect our coast. It’s about the people who live there and the economic engine. It’s about the entire state,” she said.

Others say the constitutional protection is overkill because the spending already is restricted by federal law to coastal recovery.

“The majority of that funding that’s going to come down that’s tied to any BP settlements or fines has been stringently put together by the feds and the various groups involved,” said Sen. Norby Chabert, R-Houma. “For the state to further handcuff itself into what it can and cannot do, we all believed was counterproductive.”

Champagne’s constitutional amendment dealt with money Louisiana will receive from BP and its drilling partners for violations of the federal Clean Water Act.

Gulf Coast states are estimated to split penalties ranging from $4 billion to as much as $18 billion. The exact amount will be determined in a federal trial set to resume in September.

In Louisiana, the Clean Water Act dollars are earmarked for coastal restoration and hurricane protection in statute, but Champagne wanted the language added to the Louisiana Constitution so lawmakers couldn’t easily change it.

Lawmakers in the House unanimously agreed to Champagne’s bill. But the proposal didn’t even get a hearing in the Senate, where it languished in the Finance Committee until the session ended earlier this month.

Environmental groups supported Champagne’s legislation.

But they also acknowledge a federal law called the RESTORE Act, pushed by U.S. Sen. Mary Landrieu of New Orleans, locks up how the dollars can be spent, leaving Louisiana only modest wiggle room – and no ability to just plow the money into budget shortfalls.

Steven Peyronnin, executive director of the Coalition to Restore Coastal Louisiana, said in a statement that a state constitutional amendment would have strengthened national confidence that Louisiana would be a good steward of the money.

“But the federal legislation is very specific in limiting how those dollars can be spent, and there are quite a few advocacy and oversight organizations that are determined to ensure those limits aren’t tested,” Peyronnin said.

The RESTORE Act sets aside 80 percent of the Clean Water Act penalties to environmental and economic restoration projects along the Gulf Coast. The remaining dollars will go into a federal trust fund to cover costs tied to any future oil spills.

With the confines of the RESTORE Act in place, Landrieu’s office didn’t push state lawmakers to pass Champagne’s bill. Neither did Gov. Bobby Jindal.

“We remain committed to spending 100 percent of the money on hurricane protection and coastal restoration,” Jindal spokesman Sean Lansing said in an email.

Debate over the issue taps into disputes over existing coastal protection plans and just what should be considered part of the protection efforts.

Champagne, who represents a coastal district in southwestern Louisiana, said senators suggested tweaks that she didn’t support that could have opened up existing dollars that flow to the coastal protection fund to be used for port projects and economic development initiatives.

Chabert, who represents a coastal southeastern Louisiana district, said the RESTORE Act provides more flexibility for the spending than Champagne’s bill.

He said the federal law allows some economic development projects and other types of coastal work beyond the state’s coastal master plan, a multiyear project list that provokes disagreement among coastal community leaders like Chabert.

“The intention is certainly not to build a bridge in Bossier with coastal money,” Chabert said, referencing northwest Louisiana.