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Congress Urged to Set Up Ocean Fund Financed Largely by Oil, Gas

A top official involved in ocean policy reform last Tuesday called on President Obama and Congress to work together to set up an ocean investment fund -- largely to be funded by revenues from oil and natural gas development on the Outer Continental Shelf (OCS) -- that would provide financial support for maintaining and managing the oceans, coasts and Great Lakes.

While virtually all federal offshore revenues now are from oil and natural gas producers, "we think these new and emerging technologies, [such as] offshore wind, tidal power and other resources, will generate revenues [for the ocean fund] in the near term," said Thomas Kitsos, consultant for the Joint Ocean Commission Initiative, a collaborative effort of the U.S. Commission on Ocean Policy and Pew Oceans Commission to promote ocean policy reform.

The investment fund, which would be part of the U.S. Treasury, would be "capitalized by a significant portion of the resource rents from activities that include oil and gas development as well as emerging [energy uses]," he said during a joint oversight hearing of two House Natural Resources Committee subpanels on the 20th anniversary of the grounding of the Exxon Valdez off the coast of Alaska.

The investment funds would be "dedicated to [providing] financial support for national, regional and coastal state and local programs related to understanding and managing our oceans and coasts and Great Lakes," Kitsos said. A "chunk [of the money] should also go to the federal government to try to recoup some of the losses that we've suffered in budgetary matters to address climate change" and other issues.

He further urged lawmakers to consider establishing a national ocean policy to maintain, protect and restore the health of the ocean. "Our [current] ocean governance system is essentially broken, largely attributable to fragmented management, uncoordinated decision-making and isolated policies.

"We need to appoint a national ocean adviser to the president, who is a member of the White House senior advisory team responsible for setting and overseeing the implementation of domestic policy," Kitsos said. This person should serve as chair of the Committee on Ocean Policy, which is "already in existence but [it] needs to be strengthened by making it the principal ocean entity within the office of the president responsible for, among other things, improving coordination among ocean agencies and developing an integrated offshore planning and management regime. A voice for [the] oceans needs to be institutionalized in the executive office of the president."

Moreover, Kitsos said "good [ocean] policy requires good planning and good planning requires good coordination, and moving toward an integrated, spatially based planning and management approach for the oceans is a promising process that is worth exploring" by the federal government and the states.

"Marine spatial planning refers to a process that governments can use to allocate limited ocean resources to various uses, such as oil and gas development, wind farms, recreational fishing, commercial fishing and marine conservation," said Joshua G. Eagle, assistant professor of law at the University of South Carolina School of Law.

"Marine spatial planning is often linked to the concept of ocean zoning," which specifies the "types of resource uses allowed or not allowed in given zones as well as standards and procedures for permitting allowable uses in those zones," he noted. Eagle believes that spatial planning and zoning would help the government to make better use of the ocean's resources as opposed to the system that is in place now.

Both the Democratic and Republican leaders of the two House subcommittees signaled their support for expanded OCS oil and gas production. "I am a supporter of expanding the oil and gas production both on and offshore," said Rep. Jim Costa (D-CA), chairman of the Subcommittee on Energy and Mineral Resources.

"Too much of our past offshore policy...has simply been 'No,'" and this is no longer acceptable, he said. "Therefore, I don't think we should be drawing lines in the ocean or in the sand." Rather, a national energy policy should focus on "using all the tools in our energy toolbox in the near term," Costa noted.

Rep. Henry Brown Jr. of South Carolina, ranking Republican on the Subcommittee on Insular Affairs, Oceans and Wildlife, faulted oil tanker spills for giving a black eye to offshore oil and gas development. He noted that the federal OCS program accounts for less than 2% of the total oil spillage in U.S. waters. Yet "it is tragically ironic that we continue to use tanker spills as an excuse not to allow OCS development."

Rep. Madeleine Z. Bordallo (D-Guam), chairwoman of the insular affairs subcommittee, indicated that while the OCS moratorium would not be reimposed, the level of future drilling in new offshore areas may be limited. "While I recognize that there are many who would like to see the moratorium on offshore drilling reinstated, the new administration has made clear that some drilling will be a part of our broader national energy strategy."

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