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Sunday, September 16, 2018



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Amid financial woes, oil spill money might be redirected

Amid financial woes, oil spill money might be redirected

BATON ROUGE, La. (AP) — As Louisiana lawmakers scrounge for money, state senators are eyeing an annual stream of Gulf oil spill recovery money tied to economic losses from the disaster.

Louisiana is expected to receive yearly payments of $53.3 million for 15 years from BP PLC as compensation for economic damages from the massive 2010 oil spill. The payments, which are separate from recovery money slated for coastal restoration, begin in the budget year starting July 1.

Under a 2014 law, that money will be steered to the "rainy day" fund, an elderly trust fund and a health savings account that were drained during former Gov. Bobby Jindal's tenure.

But Senate Finance Chairman Eric LaFleur is suggesting Louisiana may have more important needs than replacing depleted savings accounts. He's talking about scrapping the earmarks and using the dollars for roadwork or for lawmakers to spend on annual government operations.

"I think those benefits outweigh the trust fund benefits," the Ville Platte Democrat said. "It's a cost-benefit analysis, that's all it is."

Louisiana has a nearly $14 billion backlog of road, bridge and other transportation work. The state also has an estimated $700 million budget gap next year and projected shortfalls years beyond that.

LaFleur prefers using the oil spill money to boost infrastructure spending. He notes that President Donald Trump has floated plans to pump more federal dollars into roads, bridges and ports — but states would have to pay a share of the costs.

But Louisiana also has an immediate financial shortfall looming, when temporary taxes expire as the new budget year begins. Public colleges, the TOPS tuition program, safety net health services and public safety programs could be on the chopping block.

"That $50 million could go a long way to pay for TOPS. It could go a long way to pay for every single thing that's in jeopardy now," LaFleur said.

A special session called by Gov. John Bel Edwards to pass taxes to close the budget hole failed amid House gridlock. The Democratic governor and legislative leaders are talking about calling another special session in mid-May, but it remains unclear if money will be raised to offset the gap. Taxes can't be considered in the current regular session.

Edwards has indicated he'd consider reworking the BP money. Republican Senate President John Alario said the $53 million "could be thrown in the mix" of budget negotiations.

Senators voted two years ago to use the economic damages money for operating expenses, but the idea didn't win support in the House. LaFleur tried his infrastructure approach last year but saw that concept, too, stall in the House.

This year, LaFleur filed a bill that could be rewritten to whatever approach might gain traction.

"We're going to hold off until we see how the session goes and what direction the House takes. I'm assuming as we work through the budget process, there will be a lot more discussion about revenue streams," he said.

The economic damages dollars are separate from an estimated $5.8 billion Louisiana is expected to receive in other civil penalties from violations of environmental laws, money that's required to be set aside for coastal restoration projects and environmental rehabilitation.

Lawmakers reworked the economic damages spending once before, in 2016. At Edwards' request, they agreed to spend the first $200 million from the settlement to plug budget holes. The remaining $800 million will be doled out in the annual installments.

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Online: Senate Bill 353: www.legis.la.gov

Follow Melinda Deslatte on Twitter at http://twitter.com/melindadeslatte