Transcripts For CSPAN3 Hearing On Oil Gas Revenue Sharing 20240713

Federal lands, indian lands, good morning, everyone. The committee will come to order. First, we will examine federal revenues generated from Energy Development on federal lands, indian lands, and federal offshore areas. Secondly, we will explore how that is distributed and shared with state, local, and tribal governments. Then we will hear from onshore renewable and onshore developments. Both bills under consideration are sponsored by members of this committee. Senator cassidy, introducing in 2018 the coastal act, and senator mcsally, introducing the energy reproducing act. Thank you for introducing legislation that would bring revenuesharing for coastal producing states into parity with onshore development. Congress lay the foundation for offshore revenuesharing through the passage of the gulf of Mexico Energy securing act in 2006. At that time the bill did not include alaska. The coastal act that we are considering now would establish a revenuesharing program that would include alaska and, at the current time, our offshore production is pretty minimal and therefore any returns to the states are equally minimal. It is important to address this at this time. In fact, some of us would say that its well, well overdue in terms of timing to address it. The coastal act would do for alaska what it does for other producing states, such as those in the gulf of mexico, in terms of being able to provide onshore revenuesharing for the state to help meet critical purposes, including the protection of the coasts, assistance for villages grappling with the effects of climate change, development of lowercost clean energy generation, as well as assistance for the University System and just all that comes with our efforts to turn our nonrenewable resources into longterm assets. To me, offshore revenuesharing is a matter of simple fairness. The cook inlet, american waters, by virtue of alaska and alaska alone. We build the infrastructure and provide the Public Services needed for responsible development and we bear the impacts. As we have heard senator cassidy say many times before this committee, those who shoulder much of that burden, it is only right that they should share in a greater opportunity for the benefits. So, lets talk about some of the benefits from revenuesharing. A few weeks ago the department of the interior announced of that it distributed a lead 6 billion in revenue from Natural Resource production in fy 2019. That is significantly higher than last years disbursement of 8. 9 billion. Much of it will be reinvested back into our public lands, waters, native american, and rural communities. This year, 4. 4 billion went to the states and governments that host Energy Development. 1. 1 billion was dispersed to tribes that undertake resource extraction on native american land. 1. 7 billion dollars in mineral royalties and hydropower revenue went to the Reclamation Fund that supports a dam and Irrigation Systems that move and store precious Water Supplies across the west. We talk a lot in this committee about land and Water Conservation funds and all that they provide, programs like the American Battlefield protection program, forest legacy program, and the cooperative endangered species program. But those of us who know and understand the program, lw kiev is one of the biggest beneficiaries of offshore lwcs is one of the biggest beneficiaries. Lwcs also receives additional funds through go mesa and the Stateside Program in 2015 received 76 Million Dollars from those leases. These substantial revenues only exist because we are the worlds top producer of oil and gas. We have seen new ideas emerge on how to allocate the revenues that emerge from our production. Whether it is part maintenance backlog or helping with the recovery of wildlife, but we have also seen proposals to cut off a federal oil and Gas Production, some suggesting cutting it off immediately without consideration of the economic consequences that would prevent us from adressing the needs. As we push for the development of new and cleaner technologies, which we certainly encourage here in this committee, including our renewable energies, we have to consider what it means for federal revenue dispersants. When we think about our solar assets, the wind assets, i think we recognize that when you look, when you look to what they have generated in terms of revenues, they are a mere fraction of the billions of dollars that are generated by oil and gas. So, when we think about the benefits and how lwcs has been structured, certainly historically, it is important to keep these considerations in mind. We will have an opportunity to review some of the proposals that senator mcsally has outlined in her legislation to create streamlining while sharing revenues with local governments. We have got a lot to talk about. I am glad that we have Witnesses Today who are from both state and local governments that are the beneficiaries of federal revenuesharing programs that can help to explain what these revenues actually mean for them. I look forward to hearing how they would support, or do support, communities with the funds that they receive in this development in their backyard. I want to particularly thank mayor brower, he has come a particularly long way, from the top of the world, as we say. We know it is a long haul and we appreciate the fact you have made this journey today to share your comments. For that i will turn to senator manchin. You have come a long way and we appreciate the effort you have made. Today we are discussing two revenuesharing bills. My home state of West Virginia is a small state and we have more private land than the federal land. Im trying to understand and get up to speed on these issues. Its quite fascinating. As a result, West Virginia receives very little of the revenue that we are going to be discussing today. In 2018, West Virginia received 93,000 for the whole year. I have a hard time explaining i will ask way via have a hard time understanding all of this. My colleagues on the committee that do receive the lion share of federal revenuesharing city are rich in Natural Resources. Coal, more recently natural gas, have provided funds to my state for a long time. They are still a key source of revenue through taxes collected from coal and natural gas operations. The model for disbursement in West Virginia, where i was governor for two terms, we did this in such a fair manner, we treated all 55 counties the same as if they were the producing counties and a lot of them were not producing anything. But they are all a part of our great state. We are a part of this great country. We get very little of any of this and this is owned by the people of the country. Im very interested in this process. Now that i know more about it. Its been very enlightening. Each year the department of the Interior Office of Natural Resources collects billions of dollars in rent, royalty, and bonus bids from oil and gas leases off of those lands and waters. The geographic location determines the disbursement, which makes no sense to me at all. But thats the way they do it. I dont know when that bill was written or that law, or who got that in. Fiscal year 2019 they dispersed a total of 11. 6 billion in offshore and onshore revenue. 11. 6 billion. We got 93,000. Its important that we examine both of these contracts and constructs. The chairman and i have had conversations regarding revenuesharing in coastal states. I got it. Makes all the sense. As we know, before the gulf of Mexico Energy security became law, 100 of oil and gas revenue on the first three miles of federal waters went to the u. S. Treasury, reflecting the belief that these resources are federal. Revenue raised from the instruction must benefit all taxpayers because it is federal, not state owned. Go mesa established the outer Continental Shelf sharing. Today four states receive 37. 5 of the share of the revenue from the federal gulf of mexico outer Continental Shelf. 27 of the revenue from the the fourth through sixth not a comile, the eight g zone, that was back in the 50s or 60s, what they did was 100 for three, give us three more, we took 27 . Thats how that one was explained to me coming about. That totaled almost 223 million of those states in fiscal year 2019. This is in addition to the states already receiving 100 revenue from the first degree not occur miles. Under go mesa, lwcsf, they receive 25 of the outer Continental Shelf revenue be on the 8g zone, another 200 miles out. Onshore revenuesharing is governing them all. I know that this committee has examined the difference between how onshore and offshore revenues are handled in the past, i think that that issue is worthy of additional attention from this committee. The primary distinction between the two is that onshore lands are contained entirely within a states borders. While offshore leases are not within the state border. Onshore and offshore Energy Development also have different histories, with different leasing systems under the management of different bureaus within the department. That history in mind, changing the policy for how revenues are dispersed, whether it be onshore or offshore, requires a factual understanding of the complexities of the Broader Energy market and should not be done without careful analysis. It is also important that we make sure that these resources are being properly managed by the federal government in the first place. Over the last few years the bureau of Land Management and the bureau of Ocean Energy Management have come up short in ensuring taxpayers receive fair market value for the resources extracted from public lands and waters. Those agencies are responsible for management. September, the Government Accountability Office Published a report discussing how the boe had conservatively estimated the values of the lands they lease and even lowers the valuation of these lands to justify awarding bids. I repeat, it justifies it lowering the value of valuation when it awards bids. I have long been concerned about the unnecessary bending and flaring of natural gas on public lands, which we dont do when it is an individual or private company. Thats a value. We are venting on private lands. When gas is vented, you know what im talking about their, for purely economic reasons the gas never makes it to the market, royalty is never collected and not one of us benefit at all. They give me that the excuse that there is no pipelines, no gathering system. We can fix that. We should not be vetting this on an easy way to increase revenues. That would require conversation about pipeline infrastructure. Which we will do. But these are important conversations. Reducing flaring on public lands is not only taxpayer fairness issues, its a positive step towards addressing climate change. Its a big winwin for all of us. We are a nation that has been blessed with vast National Resources that help to make the nation the superpower it is today and while we enjoy these abundant federal resources, discussion of how revenue should be shared is extremely important and i look forward to discussing these proposals. Thank you, madam chairman. Thank you, senator. I appreciate that it is clear that these are issues that are important, important to the region, important to the country, but also understanding where one another comes from is what will allow us to, to be able to really address the intricacies and complexities. Im going to ask senator cassidy to speak briefly to his bill. He has indicated that he would like to make the introductions for mr. Lucy this morning and i would like to acknowledge the presence of our friend here on the committee, senator mary landrieu, from louisiana. Senator landrieu occupied the position of ranking and chairman on this committee. And certainly made this issue a priority of hers and her state. Senator cassidy has stepped right into that. Senator cassidy, if you would like to speak to your bill that you have introduced and that i have cosponsored, the coastal act, we will then allow for introduction of our guests. Thank you, madam chair. So, first let me say that i enjoyed senator manchins comments but there are some things that are a little misleading. Not that you intended to. Sen. Not at all. But i think it needs to be clarified. Sen. I appreciate that. I thought it was very factual, but i appreciate that. Sen. Cassidy the coastal states dont get 37. 5 of everything produced out there. There is a cap. You havent hit the cap yet. Sen. Cassidy itsalso production after a certain date, after a certain point in time. So, its not the entirety. I will show a graph. We are also always puzzled that federal waters or federal federal land, but federal land within a state boundary is not federal land for the purposes of how we do this. It always seems a distinction without a difference. Within the boundaries. That said, to continue my formal remarks, protecting the revenue of the gulf states, included increasing the share that with that we receive for hurricane flood protection is one of my top priorities. In our state by the state constitution we use the money to rebuild our coastline. A coastline that has eroded in large measure because the Mississippi River was levied for the benefit of in land ports. When you have a levying of a river that distributes sediment, therefore helps to build and rebuild for the benefit of the tributaries of the Mississippi River, there seems to be some equity involved in terms of helping our state rebuild. Its also common sense because if we get whacked by a hurricane, the federal government ends up spending a lot of money to rebuild that which was whacked. I have introduced legislation with others on this committee, the conservation of the american shoreline terrain and aquatic life coastal act, which is a part of todays hearing to create more equal revenuesharing treatment for states producing offshore energy revenue, a kind of equivalent, if you will, to those the produce onshore. For context, the gulf accounts for 60 of the crude oil supply and 15 of the natural gas. Recently the eia reported Energy Production in the gulf at a record of 1. 8 Million Barrels per day would forecast the production will continue increasing as other offshore facilities come online and Technology Evolution allows existing sites to become more efficient and productive. 2018, interior dispersed 9 billion to the federal treasury, state and local governments, tribes, and the bureau of reclamation, with funds such as the Water Conservation and Historic Preservation funds. Lets just kind of break this down. You know . So, here we see come a little bit farther above heres the federal offshore. Below is the federal onshore. We can see that offshore, the u. S. Treasury has received about 3. 1 billion over this time frame. This is go mesa, there. A small fraction of the total money dispersed. Heres the land that has been authorized by Historic Preservation and other offshore disbursements. Heres the onshore. The treasury gets . 41 billion. State and local governments get almost 1. 6 billion, Reclamation Funds getting 1. 2. It should also be noted that in the last Water Conservation fund a significant amount of this goes to states with onshore federal lands so they are not only receiving roughly a 50 share of the revenue from onshore, but also receiving dollars from the land Water Conservation act. So, if you will, this is, you are getting it here and there. Sometimes there is righteous indignation when you say that is not fair. I would argue that if we are going to have this, we should have this as roughly equivalent. Im not saying take from here, but i am saying allow the coastal states to use their dollars to rebuild the coastline, which in large measure has been lost in pursuit of policies that benefit in land states. I would also say that regarding yesterdays testimony about new mexico, these funds and be used for school testimony, roads, and other expenses. Again, more limitations. Just to repeat, state and local governments receive 50 of the federal revenues derived from onshore oil and gas in the federal land in that state. Gulf coasts gulf coast states share 35 in Energy Production. The coastal act seeks to address obvious inequity, removing existing caps on the amount of dollars shared among the gulf states and the land Water Conservation fund, raising the amount of offshore revenue that can be shared in the eligible areas from 37. 5 to 50 , protecting offshore dollars and makes leases entered into between 2000 and 2006 eligible for revenuesharing in the future. It creates a separate revenuesharing for the state with the largest amount of coastline, alaska. My state is dealing with a land loss crisis, threatening ecosystems, communities, economies, and a way of life. As i mentioned, the funds that we receive from revenuesharing go to protecting and rebuilding the coastline. I believe that chairman find a speak specifically to this, but my colleagues and i are looking for equity and the ability to strengthen Environmental Protection efforts. The states of know how to allocate the dollars in ways that will benefit our state and our nation. Thank you for holding the hearing and i look forward to hearing from our witnesses. Thank you, senator. I will go ahead and turn to my colleague, senator bross, for his introduction, and then i will introduce the rest of the panel. It is a pleasure to introduce my friend and colleague, randall luthie. He and i spent time together in the wyoming legislature. I was a member and he was the speaker of the house. A good friend. Now he is the Energy Advisor to mark gordon. Attorney, rancher, former speaker, he has brought insight to the Governors Office. Prior to joining the Governors Office he was the president of the offshore industries association, serving in the department of the interior as the director of the Minerals Management service. I had the pleasure of serving with him for many years and am proud to continue working with him. So grateful for his friendship, working together with him on behalf of the people of wyoming. We all look forward to your testimony. Sen. Murkowski thank you, senator. You have certainly been no stranger to this committee. We have seen you in your various capacities before, so welcome back. We are also joined by mr. Gregory gold, the director of the office of u. S. National resource revenue at the office of the interior. I mentioned my friend and leader from the north slope borough, mayor harry brower. He has been a leader in so many different areas. Not only as mayor of the north slopes borough, but a significant whaling captain in his own right and, truly, a significant voice in our northern part of the state. Is the specialist in the Natural Resources Earth Science policy at crs, the congressional resource service. We appreciate your being here and providing historical perspective. Mr. Klein has been mentioned. Kyle chip kline junior is the director of coastal activities for Governor John Bel Edwards from louisiana and is the chairman of the Louisiana Coastal Protection Authority board. So, we welcome you and your input this morning. And of course mr. Lucy, welcome. With that, we will commence your statements and ask that you try to limit your comments to about five minutes. Your full statements will be included as a part of the record and then we will have the opportunity to share in some back and forth this morning. Mr. Gold, if you would like to start off . Chairman, Ranking Members, members of the committee, im honored to be here to discuss the coastal act of 2019. I would like to submit this written testimony from blm, as i plan to focus my work today on the coastal act. We will include that as a part of the record. Thank you. This will provide additional revenue from Energy Production for the outer Continental Shelf and coastal states. The department of the interior is committed to ensuring american taxpayers receive a return. Matching the lands and the orders that provide the resources critical to energy security. The office of Natural Resource revenue is responsible for the management of revenues associated with onshore, offshore, and American Indian leases. The resources managed our vast. Located over 25 point 5 million acres under lease. Offshore, the department has made almost 80 million acres developed of Development Available for lease sales. In the gulf of mexico there are 13 million acres under active lease and in alaska there are an additional 275,000 acres under lease. These are a huge economic engine. Fiscal year 2018, one quarter of domestic Oil Production, approximately 15 of natural Gas Production, and close to half of u. S. Oil production in court occurred on interior managed lands and waters. 2016, 26 billion. 2018, the number through. In 2019 it exceeded 11. 6 billion, double the amount of 16. Fiscal year 2019 this first mintz included 5. 2 billion to the u. S. Treasury, 1. 7 billion to the Reclamation Fund, 1. 1 billion to American Indian tribes and individuals. 1 billion to the land and Conservation Fund. 150 million to the Historic Preservation fund. 2. 4 million to state and local governments. 2. 4 billion to state and local governments. 2. 2 of the dispersed, they were sent onshore lease states that had federal lands and the remaining was dispersed to states with leases on or adjacent to the outer Continental Shelf. Production of oil on federal lands have increased over the same time period. Fiscal year 2016, Oil Production totaled 729 Million Barrels and it grew to 803 Million Barrels. 2019, exceeding 831 Million Barrels, increasing 11 from 2016. The constitution gives congress the power to govern the property owned by the United States. The American People all share in their ownership. There is a long history of Congress Making and changing laws pertaining to these federal resources on behalf of states, tribes, local governments, and u. S. Taxpayers. The policies to promote Clean Development of vast Natural Resources and it is our ability to collect and account for the Natural Resource revenues from the states, American Indians, and u. S. Treasury. Chairman murkowski, Ranking Member mansion, members of the committee, thank you for inviting me here today. Im happy to answer any questions the committee may have. Thank you. Thank you. Mayor, welcome, appreciate any comments this morning. Thank you. Sen. Murkowski , sen. Manchin , members of the committee, thank you very much for giving the opportunity to speak this morning about legislation for our coastal communities. I have lived in alaska do serve as the mayor of our town. Stretching from east to west by 600 miles, home to the National Petroleum reserve and the National Arctic wildlife refuge. It is appropriate that i have the opportunity to talk to you today about revenue sharing for k alaska native claims settlement act, allowing alaska natives to take time for millions of acres of land around the state. On the north slope, the state had already selected the area around the bay. The federal government had already set aside the Arctic National wildlife refuge. These areas were not made available for selection by native people. Because of the cost of federal and state government, the oil and Gas Resources had already been cleaned on the gas on the north slope. We had worked with the leaders to create the boro giving our people the ability to tax the structure, thereby benefit from the resources being developed in our backyard. Our ability as local government to derive benefits from oil and gas for almost 50 years supported health clinics, schools, modern sewer infrastructure in our villages. A Tribal College and police. And emergency services. Services that most americans take for granted. In a speech that he gave in 1976, evan hobson discussed a discovery by the federal government formerly called barrow. The navy established a Small Research facility and drilling led to the discovery of natural gas in 1949. The gas field was developed near the community. Natural gas was used to heat federal buildings, like the hospital. The bia school. The navy buildings. The government did not allow the community to use the gas to heat their homes. In a speech, he spoke about the long, frustrating, 12 year struggle to get permission to hook our homes up to natural gas mains that crisscrossed through our backyards. It sounds incredible today, the government refused to let the residence of barrow use the natural gas that came from our own backyard to feed to heat our own homes. It took an act of congress in 1963 to allow the native people of barrow to buy their own natural gas back from the federal government. The arctic ocean is a place where you have hunted for flails and walrus, seals, for thousands of years. Someday, oil and Gas Resources developed in the arctic ocean, those offshore resources, just like on shore resources, will come out from our backyard. The development of that resource will have an impact on our community. It is only fair that some of the revenues from the developments should be reinvested in longterm survival of our communities. As well as revenuesharing from onshore mineral development. The gulf of Mexico Energy security act provides revenuesharing from offshore oil and Gas Development in the gulf. Whatever each of you as individual members may think about oil and Gas Development, it would be unconscionable to oppose legislation that would extend the grouping to alaska to provide the fairest share of resource revenue to communities impacted. I would like to thank senator murkowski for her work on this issue and i look forward to the opportunity of speaking with you today. Thank you. Thank you. Chairman murkowski, Ranking Member mansion, manchin, members of the committee, good morning. As requested by the committee, my testimony will focus on the revenuesharing provisions of the two bills under discussion. We take no position on these bills or other policy matters. My testimony jaws on my own area of specialization, federal management of offshore energy, and on the input of other colleagues who cover Onshore Energy and Broader Energy policy issues. I will discuss each bill in turn. F2418 would make changes to offshore oil and gas revenue sharing in the gulf of mexico and alaska. Title number one would amend the gulf of Mexico Energy security act, governing revenuesharing with four producing states, and with a state Grant Program from the land and Water Conservation fund. The bill would provide for a higher portion of revenues to be shared with the state. It would do this first by expanding the set of leases eligible for revenuesharing. It currently applies only to the leases entered into since 2006. Affecting approximately 50 of the active leases. It will include those entered into since october of 2000. The bill would increase the percentage of qualified revenues shared with the states. 12. 5 percent are shared with the lw kiev programs. The remaining lwcf programs. It would change this so that 50 would be shared with the states and 37. 5 would go to the treasury. The 12 points 5 for the 12. 5 would remain the same. Cap annually for most years cap annually for most years, the bill would eliminate the cap. Collectively, these changes would have the effect of increasing golf revenues shared with the states while decreasing the share going to the treasury. Title two would establish an offshore revenuesharing program in the alaska region, similar in many ways to the program for the gulf, though with distances differences. Current law allows for all to go to treasuries except for that that is near state waters, this would split the between the treasury and the state with its coastal subdivisions. It could be used for those similar to coastal mesa, like Infrastructure Projects mitigating impact on offshore development and for purposes not covered in go mesa. It could relatively limit fiscal impact in the near term, alaska has fewer leases and generates less revenue. Future revenue in the region is uncertain and would depend on many factors. The second bill, 2666, making changes in section nine related to onshore revenuesharing from solar and wind energy on public land. We focus on this revenuesharing provision and do not cover other aspects of the bill, requiring the bureau of Land Management and the Forest Service to disperse 25 percent of solar and wind revenue to states, 25 to counties, the remainder to two programs established in the bill to facilitate permitting and recreational access. Blm and the Forest Service administers a rightsofway projects under federal Land Management act. Almost all of the current projects are on their land. Revenue includes rent and fees. Currently other than fees retained by both agencies, they are deposited to the treasury. Its subject to the the agencys general revenuesharing requirements over seven years, also shared with counties. The remainder goes to the treasury. Under 2666, no revenue would go to the treasury, as state sharing and the new programs would account for 100 of the funding. This concludes my remarks. Thank you, i look forward to responding to any questions. Sen. Murkowski thank you. Mr. Klein, welcome to the committee. Thank you for allowing me to speak on the merits of the coastal act and revenue sharing. Thank you for sponsoring this important legislation. Federal lands located on in land states and waters of the Continental Shelf produce resources for the benefit of all americans. However, the federal government relies on the states for these activities to be successful. The 1920 acted determined that the federal government needed to share these revenues with this faith if the states were going to be successful in providing these services. Under this legislation, in land producing states share 50 of revenues generated from all leases on federal land and are allowable uses have expanded to include any government activity of the state. This generous revenuesharing has become extremely important to the states. In fact, according to a department of Interior Officer last week, the federal government returned 1. 1 billion to the state of new mexico from oil and Gas Production on federal land there. To be clear, we support the revenuesharing for in land producing states. However, when federal mineral production offshore, no similar revenue share was provided to the coastal states. It wasnt until the passage of 2006 that the federal government provided any amount. They have provided the same services that promote this activity as the onshore states. The vast and simple infrastructure was needed to transport the energy across the nation. All of these activities have helped generate hundreds of billions of dollars in the federal treasury. I would like to draw your attention to the map just behind me here that shows the thousands of miles of pipelines that cut across the coastal wetlands. They are essential for federal offshore oil and gas to you to the people, communities, and industries of america who rely on the energy. Louisiana is proud of our coast and our contribution to the energy needs of the country, but this comes at a cost to the state. Putting this at greater exposure to environmental conditions and storm surge. Today, go mesa applies to just 5 of the total production in the gulf of mexico. Information thats only from 2006. Half of that revenue remains with the federal treasury. The remaining 50 is further divided by the Conservation Fund and the states 42 political subdivisions. The revenues are cap at 375 million. Applying this disparity, it increases the measure of the revenue shared to 50 rather than the current 37. 5 . Changes would achieve for the comesa states, that governed by the land leasing act. Louisiana is mandated by federal law and by our state constitution. We have committed all those funds to the protection and restoration of our coast and implementation of the coastal master plan. Our framework for making difficult decisions. A tool based on the best available science and to confront the analytical challenge of a complex coastal environment, taking into account unsure conditions, multiple project types, and Diverse Community needs. The bottom line is that we are being responsible with the dollars returned it to us, reinvesting them back into the coast and building projects that protect our homes, our communities, our businesses, our environment, our way of life, and the very infrastructure that continues to help fuel the nation. Thank you very much. Sen. Murkowski thank you. Welcome. Thank you. I appreciate the kind of production from mr. Brasso. Its always good to be here. Introduction from mr. Brasso. Its always good to be here. Thank you for the opportunity to meet with you and discuss with you some of my favorite things, wyoming, energy, and revenuesharing. The governor sends his best regards and is appreciative of the efforts to work with the state. Ranked third in total Energy Production, it also raised more than 5 billion to the annual gdp, which is supplies over 46,000 jobs. Were the number one producer of coal, employing over 5000 people and 11 of the nations electricity. This isnt a topic of the hearing today, but coal should remain a part of the energy mix and we can do that through solar do that. In total, wyoming exports of 300 btus of exports of energy every year. A while i am concerned that the black friday like stampede towards nontraditional sources will likely actually resulting blackout fridays, the future is clear that there will be more solar and wind. Recently a large Utility Company rebuilt its resource plan. The replacement power will be 1800 megawatts of solar and 2000 megawatts of wind. The islander believes it is a broad array of Energy Resources being the way for a Reliable Delivery system. We plan to continue the legacy of an Energy Leader with a Good Relationship with the federal government. This is a good pace of habits to maintain and enhance that Good Neighbor relationship. This is a good place to maintain and enhance that Good Neighbor relationship. We suggest that when the secretary determines the most appropriate areas, it only come after consultation with the states. It should be more than a checking the box function and preferably through the offices of the governor. Grandfather in projects that are not completed but face the current models. Habitat impacts are not renewable. There are real costs to state and local governments. Per megawatt, there for pot footprint is larger, resulting in a single use of large swaths of land. With four of real enthusiasts and hunters four wheel enthusiasts and hunters being part of the same family, multiple uses for land is typical in wyoming. Often nonusable bland blades are taken to landfills and there life of the project, the job and tax revenue connected with these projects do not compare with the number of jobs and tax available through traditional sources of energy. That is the revenue sharing portions of this bill are key. Current revenue sharing is 48 , which i point out should be 50 . Subtle, let me underline subtle. It was introduced by cliff hansen. Mexico and wyoming are usually the largest recipients. New mexico received 1 billion recently, mexico 640 million, there is something a little wrong with that picture. The committee should consider revenuesharing programs similar to the earmarking of 35 of the fund account for habitat promotion of hunting and fishing is great. The best distribution mechanism would be directly to local and state is asian. Organizations. It is likely those funds will not only miss the bullseye, but the entire target. The wyoming trust fund has been in existence for 15 years. It does projects like underpasses and overpasses over highways so wildlife is able to avoid traffic. It provides revenuesharing with other programs in cooperation with land owners. Existing programs such as partners for fish and wildlife also have a good record of working with the state. They are usually underfunded. They should be considered in the distribution scheme. In addition, any development and land disturbance is on consequences. The induction of invasive species. Is important to allow maximum flexibility whatever the Distribution Plan to allow funds for local solutions as such as control of invasion species. Senator gordon has supported such legislation and look forward to working with all of you. Thank you. Thank you all. Thank you all for your comments this morning all for your comments this morning and your input to this very important conversation. I so appreciate you giving the detail of the history that we have seen in alaska and particularly up in our north slope with the federal ownership of land, and how those lands, whether it was in nvra, or over on the eastern side and the wildlife refuge area. Effectively, the federal government came in without much discussion to those that have lived there for generations, thousands of years, and determined that these federal lands would be available for the federal government with no sharing with the people within the region. As you have pointed out, this measure we have in front of us today is in part to help address that lack of parity, the lack of sharing, and to recognize some of the challenges that a borough like the north faces. You have had shared with us by way of comparison the size you are dealing with. Eight villages across an area of 600 miles. The National Petroleum reserve, the size of the state of maine. The area within and wire, the size of the state of california. When you think about how services are provided, each one of those those communities is an isolated community. There is no road connecting the eight, so that you have any level of efficiency. Everything from search and rescue, to Power Generation within communities, the transportation facilities, small air strips, everything has to be unique and and really selfcontained. These are truly island communities, as such, being in the part of the country that they are very expensive. You have outlinedyou have outlined briefly some of the benefits that revenuesharing can help provide. Everything from operation, to clinics, schools, sewers of a Tribal College, emergency services. Can you share some of the some of the threats that you are seeing from an infrastructure perspective across the borough, do you due to the coastal erosion issues that you have to respond to because they are threatening the people within the communities . Share with us how the borough deals with the cost of providing for these infrastructure upgrades, or whatever may be needed to help facilitate these communities. Thank you. I think these are important subjects to cover. As you have identified. The areas the coastal erosion is prevalent in our coastal communities. We are losing land to the ocean because of the continuous wave action, coastal erosion, erosion, less ice presences causing more coastal erosion in an accelerated pace. The funds that the borough provides for this these measures trying to protect the communities are very costly. In the millions of dollars that we provide to these communities to build up a small sea wall in the time that his it has been impacted by squall storms. We have a seawall we have built out of these super sacks, that is what we identify them as, as we learn from the industry to build their islands. Filling them with gravel to retain and minimize the effect of coastal erosion. These are extracting gravel to fill in those sacks is costly. Placing these sacks in areas of importance. We have had a military base in the naval arctic reserve had a space in their based several miles out of the community. They had a large landfill that had developed to put its waste into this landfill over time. Debris of all sorts. Hazardous waste, in a sense that were placed in this landfill. That landfill is near encroachment of the coastal erosion. Constantly getting closer. Madam chair, i was in your office several years ago about the observations we are dealing with in terms of if it ever gets exposed and breaches the site, there is contamination to the arctic ocean. It and significant issues will arise from the breach of that landfill. It is a military site, it is very important, but we do not have the resources to identify to help minimize the coastal erosion impact that is all along our north slope coastline. My time is expired, but what you are speaking to is a very present threat. This is not something that is could be expected decades from now. The impact to the waste site, what we have seen with the threat to water and sewer infrastructure there, my Ranking Member here senator manchin was with me in knows that that airstrip is not the original strip. This is a new runway that has had to be built because of the coastal erosion. I will come back for a second round, and we will have further discussion. These are very important to put on the record. Senator manchin. This question mr. Gold mrs. Coming can speak on this man that i have other questions. The outer net the outer Continental Shelf plants was both bills establish royalties and other requirements to ensure public lands are not a total freeforall. These resources can be made available at times of national need. My question would become a with that in mind, could you speak to what the reason was to giving a states a 50 share in the mineral leasing act compared to the 37. 5 for mae sai . Mesa . I was not privy to those discussions. We honor as we ensure whatever that law says, we will collect and disperse properly according to those laws. The underlying reasoning for why those laws were passed, it is not something we were involved in. You have a comment on the fairness of that, or any quality of that . I do not have any comment on that. Senator, the question about the mineral easing act would probably be better for some of my colleagues to cover the entre sides to address, in terms of in terms of the mesa provisions for the 37. 5 revenue share, as is the case, some of the issues debated at that time are some of the ones we talked about. On the one hand, the environmental impacts to coastal states of hosting offshore development, and the investments they make an infrastructure. On the other hand, the position of some that the fact that the waters are not in the state would make a difference in terms of the type of revenuesharing that might occur. Mr. Kline, you may be able to answer this pair die understand the master plan was created to help protect coastlines. I spent time in your state and i enjoyed. Under the Louisiana State constitution all of the funds the state receives under go mesa go to a master plan. Our go mesa funds are the only federal funds going towards projects louisiana coastal master plan, or are there statements matching that . The only recurring source of revenue we receive comes from the gulf of Mexico Energy security act. We do have state funds derived from mineral production on state lands and state water bottoms. The last three years, louisiana has run budget surpluses. The governor has allotted state dollars to the Coastal Trust Fund for Hurricane Protection projects. These are on an annual basis, all of those torts that i understand. As much as we can, yes sir. Historically that is typically about 35 million per year depending on the production. As i mentioned, in addition to the mineral revenues derived on state lands, we had last year governor edwards allocate an additional 55 million. This year, we have been asked to put together a proposal of 220 million for Hurricane Protection projects across our coasts. Mr. Gordon, i think you heard me in my opening statement, methane from oil and gas operations on public lands. As i said, these are public resources. Taxpayers lose out. So does the environment. Conference, the comparative impact of methane is more than 25 times greater than Carbon Dioxide over a 100 year period. What steps are you taking to reduce flaring . I cant speak to what is done by the bureau of Land Management. You know it is not healthy, right . Of course. The revenue part of it is something we work closely with the bureau of Land Management on. We work with them to do analysis of whether it is affordably lost or not. Any estimation of how much is being flared on federal lands . Right now, we are working closely with the bureau to get those numbers. It did not seem like a hard number to get. We know how much flaring based on production. We have to go through and see what is avoidable and not in the production process. Those numbers have to be dashed out. We are working with them right now. I will see what we can do. Thank you. Lets say by the end of the month . Mr. Klein, i will be speaking with you. First, we are in the senate and we want to pick up our own state. You say your states problems are unique end of national significance. In this case, i am being more than an homer a homer. You can get a chapter and verse, but as i understand we have lost land in louisiana relative to Sea Level Rise greater than the entire state of delaware. The central golf has the greatest amount of elevation lost in the entire nation. Grand isle Barrier Island off our coast has lost nine feet or six feet . Approximately eight feet. The florida coastline in pensacola has been an order of inches. This is in part because of the leveeing of the Mississippi River after the 1927 flood. John berry. Hate to say that this week was about how that was done for the benefit of importance. All that said, let me complement you. Our colleague from rhode island came down, he said our coastal master plan was the best relative any state in the nation. I know it has gone under three administrations at least, but congratulations. Lets establish that this is not just a local significance, but national. Can you tell us what National Energy assets would be affected so we continue to have unabated coastal loss . Go tigers. Senator, when we talk about the National Economic assets, we like to start with port bushong. It is a port that services 90 of the oil and Gas Production in the gulf of mexico which transports 70 of the oil produced in mexico. We have two sites in louisiana which serve as strategic housing for Petroleum Reserves which house hundreds of millions of barrels of oil for emergency situations across our country. Our lng rank fourth in the entire globe. We have major refineries that refine materials used in do you include the coastal area in the Mississippi River, in the United States there is no other place making Refined Plastics that we need to create jobs. That is right. That is leading off, if you will come i think after alaska we have the greatest amount of seafood production in the United States as well. Let me ask you this, you will know this, what is the general Flood Elevation in the region of our estate where these Energy Assets and Seafood Industries are located . Flood elevations very, but typically the Flood Elevation across Coastal Louisiana is just above five feet above sea level. There are areas across our coast, the city of new orleans, that is probably close to five feet below sea level. The risk, as a result of those elevations, is that our coastal communities if we experience a hurricane similar to katrina or rita, our communities could see a storm surge of anywhere from one feet15 feet. If you rebuild coastline if you rebuild coastline and have wetlands as a bumper for from that cat for, how does that help diminish the impact . Coastal restoration and hurricane go hand in hand. When you restore the natural environment, your wetlands and marshlands, youre taking the pressure off of your in land Hurricane Protection systems. We are supporting our environment, that is our first line of defense in Coastal Louisiana. For every mile of coastline, you take a cat four down to a cat three, but for every acre of wetland you create or build, you knock down storm surge by a certain percentage. Folks may not be aware, but i am aware, three of the largest ports of the nations by tonnage are in louisiana. For the farmer in iowa to get his goods to the rest of the world, at a competitive price, it is the port of new orleans, the port of south louisiana that allows that to happen. Yes sir. Five of the top 15 ports are housed in louisiana. I may have to ask the senator to whisper into your ear but i think we spent about 20 billion on katrina. Well north of 220 billion. The government response was i think was 100 billion in total response. The Hurricane Protection system that was built around the greater new orleans area was in the neighborhood of 14 billion that was invested in that area responding to that disaster. I am out of time. Lets say that if we spend 100 billion in response, but we can have enhanced restoration, which in turn will decrease the potential need for another 100 billion so that goods from iowa can get around the world and that oil and gas can get from wherever to wherever, that would be a penny wise investment . Thank you. I yelled back. That i yield i yelled back. It occurs to me in your conversation with the mayor, and obviously i had a chance to that is a new dynamic. All of this i think theres bears considering the real climate impacts because Sea Level Rise is accelerating when you overlay the impacts that a lack of ice has had. This is going to continue to accelerate. Were going to have to figure out how to deal with not only communities on the coast, but as the mayor said, a legacy of all sorts of Hazardous Materials that currently sit in lowlying areas. All sorts of Infrastructure Associated with Energy Production that are in lowlying areas. That is going to cost an enormous amount of money. It is going to take an in normas amount of creativity. Mr. Gould an enormous amount of creativity. We do not have a witness from the blm, the blms written testimony expresses opposition to the revenue sharing because of concerns with the potential longterm costs of diverting those from the treasury. The cost of that, i estimate based on recent numbers to be about 22 million per year. Yet, your testimony on the coastal act, you did not express concern about the longterm costs of greater revenuesharing of offshore oil and gas revenues. Do you know with the projected longterm costs are for the coastal act . This is not a commentary on whether we should do it or not, it is addressing real concerns. Do you know what it costs . I do not have those numbers. Those numbers are done with the bureau of Ocean Energy Management. They do the longterm estimates. They look at economic impact. Do know enough to know whether they would be greater or less than 22 million a year . Greater. We need to get all of these things scored, but i am estimating roughly 1 billion a year. 10 billion over the course of a 10 year budget window. Why is the administration not concerned about those costs. . I think the written testimony expressed their concerns. From perspective, we take what you all feel is best to disperse revenue. I only bring that up because it appears to me to also speak to the issue of fairness that senator cassidy brought up. I would love to rescue you more questions about why the blm has been so slow to move forward on development . From the start program, maybe senator course as senator cortez can answer nevada seems to be the only place we have seen progress in terms of those areas of roughly 700,000 acres that were designated as high potential, low impact zones for renewable Energy Development. We have seen progress in nevada. We have not seen that progress in other western states. I would love to know from the blm why. And then i would make the point, a number of people have referenced how new mexico is currently going through quite an increase in production. You see that in the revenues flowing. We are also seeing an enormous issue with methane. It is frustrating for me to see the department of interior rollback its methane role, when nasa documented a statesized cloud of methane over the San Juan Basin in new mexico. If we are going to produce Energy Resources, we have a Public Health responsibility to the communities where they are produced. It is frustrating for me to see when we have had states including wyoming, colorado, that have had to step up and fill that vacuum because the the department of interior has not done it, to see those rules rollback. I will tell you as a result, new mexico is in the process of moving forward on rules. The department has simply not met their responsibilities to Public Health. Senator heinrich, thank you. Thank you chairwoman murkowski. To talk about my bill with senator manchin the public land Renewable Energy develop intact. This is an important bill for arizona. Renewable energy, particularly solar is an Incredible Opportunity for arizona. We have an abundance of two things, sunshine and open space. In state where nearly 70 of our land is controlled by the federal government, burdensome federal permitting processes, and noncompetitive prices severely restrict Renewable Energy potential. Our bipartisan bill institutes a common sense improvement to the Committee Process to expedite the approval of solar, wind, and geothermal progre projects. Most important, is the bill ensures states and counties with massive federal footprints share the revenue from Renewable Energy produced on public land. A portion of revenue will be dedicated to conservation activities, which will improve Wildlife Habitats and public land access. Theres a multitude of benefits the bill delivers. We brought together a Diverse Coalition of support from industry commit state and local government, and environmental and recreational stakeholders. I have a list of 50 endorsements this bill has earned. I would like to submit this list and several letters of support into the record. I appreciate you communicating overall general support of our bill. Wyoming shares similar challenges not quite 70 baby 48 maybe a large footprint can rate the similar challenges for you. Can you share how you think revenuesharing provisions of our bill can help local governments and ultimately that residents . Thank you for that opportunity. Yes, wyoming is well acquainted with revenuesharing on other energy types. If you do rough calculation of our general budget, those resources directly from shared revenue resources are about 20 of the total state budget. That is a big chunk. Over 50 of the states budget is connected with k12 education. Any revenue sharing it allows to come back to the state, or directly to the counties or cities is going to be used for necessary programs. As you mentioned, projects do have impacts. They have economic benefits, but they also have impact. On the particulars i mentioned in my testimony, renewables is a rule as a rule has impacts upfront. It also has construction costs, which during construction, you have local once that construction