Mary Landrieu has been quite proud of the 2006 Gulf of Mexico Energy Security Act as she campaigns for her fourth term as a Senator. One figure she frequently mentions when touting GOMESA is $500 million dollars – the annual cap on revenue shared under the program. Unfortunately, GOMESA has yet to fully ramp up, and actual amounts disbursed to Louisiana fall far short of the half-billion range. Because of this, the Reveille/MC 4515 fact-checking team has rated Landrieu’s claim as “Questionable.”
How short?
Louisiana received $100,962.69 in 2012 and $95,813.57 in 2013.
Those aren’t typos. All commas and decimal places are correct. The program was not designed to immediately pay at its maximum level. Initially, GOMESA only applied to two small drilling regions in the Gulf of Mexico. The program is slated to expand dramatically in 2017, with disbursements from those broadened revenues planned to be disbursed to the states starting in 2018.
When Mary Landrieu lists GOMESA among her accomplishments, she always mentions the half billion limit. While it’s true that GOMESA is a program with a half-billion dollar cap, that cap is completely irrelevant until GOMESA ramps up in 2017. At the moment, bringing up the GOMESA half-billion cap is like promoting a tortoise race by saying that it has a 500 mile-per-hour speed limit.
What’s more, there are issues with GOMESA going forward. Louisiana (and the other Gulf states included in the deal – Texas, Mississippi and Alabama) can’t wait to receive substantial sums from oil and gas production in the gulf, but that money isn’t being conjured out of thin air. It will come out of federal coffers as the federal share of oil & gas royalties gets reduced.
This explains the White House’s opposition to lifting the $500 million cap on GOMESA funds. This opposition is why it seems dangerous to view GOMESA’s half-billion as sure-thing mailbox money. Nobody is going to fight the Gulf over thousands of dollars. Billions are another matter.
GOMESA has not been a point of contention in the race, because both Cassidy and Landrieu have campaigned on their efforts to build on GOMESA. Both candidates have used the $500 million figure, and neither has emphasized that the money involved is currently more trickle than flood.
Because of how revenues are distributed, and because of the inherent lag between the sale of an oil lease and the receipt of revenue once that lease is developed, GOMESA receipts are currently at the lowest point they should ever reach for the life of the program. They should increase roughly thirteen-fold in 2014, based on 2013 federal receipts.
GOMESA serves as an interesting example of the disparity between stated programs, and how they function in practice. When a program is described continuously in terms of maximums and potentialities, it’s easy for the reality of today to be overshadowed.
Direct information on GOMESA disbursements can be found online at: http://statistics.onrr.gov/ReportTool.aspx
The Reveille’s GOMESA interactive shows total disbursements to date through the program, and does demonstrate that over the course of the program, millions have been distributed. However, at the time of the campaign, with GOMESA being touted as a legislative feat, those distributions are much more modest.
How much is $500 million? Not much – not yet.
October 30, 2014
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