Bush fought funding in Energy Bill for Gulf Coast protection

The administration strongly opposed the new funding as "inconsistent with the budget."

Published September 1, 2005 11:02PM (EDT)

With New Orleans underwater and much of the Gulf Coast in ruins, President Bush is promising to do all he can to help. But just 48 days ago, his administration was actively opposing attempts to shore up the coastline where Hurricane Katrina made landfall.

In the recently passed Energy Bill, there is a provision that grants $1 billion to states with offshore drilling platforms for coastal improvement work. The bulk of this money, $540 million, will go to Louisiana, which is rapidly losing its coastline to erosion, a process that makes population centers like New Orleans more vulnerable to hurricane damage.

This provision was so offensive to White House policymakers and bean counters that it merited a paragraph-long treatment in a six-page letter written by Energy Secretary Samuel W. Bodman on July 15 reviewing the merits of the Energy Bill.

"The administration strongly opposes" the new funding, Bodman wrote. "These provisions are inconsistent with the President's 2006 Budget and would have a significant impact on the budget deficit."

Congress overruled the White House objection, President Bush signed the Energy Bill, and the money will begin flowing to coastal states in 2008. The money can be used by states, including Mississippi and Alabama, for everything from marsh reconstruction to levee and road building. It is just the beginning of the expected cost. In Louisiana alone, the cost of restoring the coastline was projected to top $14 billion -- and that was before Hurricane Katrina.

The White House objection dealt, in part, with the source of the funds -- existing offshore gas royalties. Historically, gas and oil revenue from federal land is split with states. Offshore royalties, however, go entirely to the federal government. "We wanted our fair share of the revenue," said Brian Richardson, a spokesman for Louisiana Sen. Mary Landrieu, a Democrat who fought for the provision.

The White House saw things differently. In the letter, Secretary Bodman suggested that the department would be open, however, to some future discussions, including providing the states some "new royalty revenues" from "new oil and natural gas resources" generated through offshore drilling. "We didn't object to the idea in principle," Craig Stevens, the press secretary for the Department of Energy, said of the coastal reconstruction money. Rather, he said, he objected to "part of the way it was crafted."

When asked what those parts were, Stevens said he would try to find out. He did not call back before deadline.

By Michael Scherer

Michael Scherer is Salon's Washington correspondent. Read his other articles here.

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