Trump budget kills offshore oil revenue sharing for Louisiana, other Gulf states.

President Donald Trump‘s proposed fiscal year 2018 budget calls for repealing the Gulf of Mexico Energy Security Act, which Louisiana officials have counted on to provide up to $140 million a year for coastal restoration and hurricane protection projects included in the coastal master plan.

According to summary tables provided to reporters by the White House Office of Management and Budget during an embargoed news conference on Monday, the Trump administration expects the repeal to save $272 million in 2018 by rescinding the sharing of about 35 percent of Gulf offshore revenue with Louisiana and other Gulf states. The money lost to Gulf states would total $3.56 billion through fiscal year 2027, according to the summary tables.

The repeal of GOMESA was not mentioned in a six-page executive summary released at the same time as the summary tables, and was not mentioned by OMB Director Mick Mulvaney in the news conference, according to a transcript of the news conference.

President Barack Obama proposed cutting GOMESA funding in 2015, but his effort was turned back by Congress.

Cutting the revenue sharing program would devastate the state’s restoration and protection plans, state officials said early Tuesday. 

“President Trump’s budget proposal to eliminate GOMESA revenues would essentially end the coastal program as we know it,” said Johnny Bradberry, Gov. John Bel Edwards’ coastal adviser and chairman of the Coastal Protection and Restoration Authority. “GOMESA is the coastal program’s only source of recurring revenue from the federal government and it’s a revenue stream we have largely planned our efforts around. Eliminating GOMESA would have wide ranging impacts in our ability to restore our coast and protect our coastal communities.”

The revenue sharing legislation was originally sponsored by former U.S. Sen. Mary Landrieu, D-La., who hammered out a complex compromise with other Gulf State members of Congress to slowly ramp up the money coming to Louisiana and other states. Louisiana would have received a first large payment of about $140 million under the act in October 2018.

In Louisiana, the state’s share of that money was required by a constitutional amendment to be placed in a trust fund for use only for coastal restoration and hurricane protection projects. Coastal parishes are expected to receive up to another $30 million in direct revenue-sharing payments, once the larger share of offshore money kicks in in late 2018.

The repeal proposal was immediately attacked by the America’s WETLAND Foundation, a non-profit organization that helps support the state’s coastal restoration efforts.

“The fight for a share of (outer continental shelf) revenues was long and, finally, real dollars through GOMESA would  begin coming to the state next year. Louisiana’s coast is disappearing at an alarming rate and if this  budget stands, it will put one of America’s most essential estuarine areas at even greater risk,” foundation senior adviser Sidney Coffee said in a news release issued early Tuesday morning. “Losing this important source of funding would be devastating to  Louisiana’s efforts to salvage the very coastline that benefits the entire country.”

Officials with the administration of Gov. John Bel Edwards were not immediately available for comment.

However, Edwards has been urging the Trump administration to increase federal support for restoration projects. On April 18, Edwards declared a coastal state of emergency, sending a copy of the declaration to the White House. The state Coastal Protection and Restoration Authority has been working on a white paper for the Trump administration outlining the state’s concerns about the slow pace of federal permitting for major coastal restoration and protection projects.

On May 16, a White House spokesman said the Trump administration would provide Louisiana and other states requesting that projects be designated high priorities under the president’s proposed infrastructure funding program “with additional information as the interagency process moves forward.”

“The White House, the Council on Environmental Quality, the Federal Permitting Improvement Steering Council, the National Economic Council, the Office of Management and Budget, and various additional federal agencies continue to work on the administration’s infrastructure initiative,” the White House spokesman said then.

The loss of GOMESA funding also has the potential of threatening the state’s ability to repay the Army Corps of Engineers the state’s share of the cost of rebuilding the New Orleans area levee system in the aftermath of Hurricane Katrina. The state will have to begin repaying as much as $100 million a year for its share of the levee costs as early as 2018, as efforts to get Congress to forgive the repayments have so far been unsuccessful.

While the Edwards administration has not said that the GOMESA money would be used to repay that debt, the alternative would be for the state to pay for it out of its annual capital outlay budget. The Edwards administration has proposed a fiscal year outlay budget of $1.3 billion, which does not include money for the first levee payment.