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Revenue-Sharing Fight Presents Conservation Fund Backers With Challenge, Opportunity

A push by a group of senators to divert more offshore oil and gas royalties to coastal states presents a new challenge — but potentially a fresh opportunity — for defenders of the beleaguered Land and Water Conservation Fund.

The fund, which provides resources for acquiring public lands for recreation, also relies on offshore drilling revenue. Though authorized at $900 million annually, the fund is subject to the whims of appropriators and the amount actually provided is typically far less — $322 million in fiscal 2012, for example.

With the fund’s authorization set to expire at the end of fiscal 2015, its mission is twofold: secure a permanent source of mandatory funding while countering arguments that the money is used for federal land grabs.

Alan Rowsome, who works on lands policy at The Wilderness Society, said the fund has helped protect nearly every national park and refuge, not to mention many local parks and recreational spaces.

“It’s a very successful 50-year program that has borne out in every congressional district — in just about every town, city, park, refuge,” he said.

In addition to providing money for federal land acquisition, the fund offers matching grants to assist states in recreational planning. Still, many Western lawmakers have been wary about any federal programs that make land in their states off limits to economic development.

And now supporters of the fund also must contend with the effort by coastal-state senators to claim a bigger share of oil and gas revenue. Sens. Mary L. Landrieu, D-La., and Lisa Murkowski, R-Alaska, have developed a proposal to send more of the royalties from offshore oil, gas and renewable-energy production to coastal states, which could qualify for additional funding by establishing clean-energy or conservation funds. The Senate Energy and Natural Resources Committee is expected to hold a hearing on the bill (S 630) later this month.

Efforts to overhaul the sharing of federal offshore drilling revenue could provide an avenue for Land and Water Conservation Fund supporters to strike a deal that would maintain ties to outer continental shelf receipts while ensuring more consistent funding.

The revenue-sharing proposals aren’t the only ideas floating around Washington that would build on the fund’s basic policy precept of using financial benefits of offshore resource extraction to invest in conservation on land. In his State of the Union address, President Barack Obama called on Congress to establish a trust fund for alternative-vehicle fuel research seeded by offshore drilling receipts. And that’s all in addition to a White House budget proposal to gradually make funding for the Land and Water Conservation Fund mandatory.

There is more than enough money made from offshore leases, bonus bids and royalties to meet the fund’s authorization level — with billions of dollars to spare for other priorities. The Interior Department collected about $6.8 billion in fiscal 2012 from the offshore oil industry, a number that is expected to grow as more tracts are leased in the Gulf.

But Congress has been increasingly stingy toward the fund, with appropriations declining 39 percent over the past decade after a few funding spikes toward the end of the Clinton administration.

Supporters hope that retiring Sen. Max Baucus, D-Mont., a vocal proponent of the fund, can use his influence to advance changes to how the program is funded. Baucus has sponsored legislation (S 338) to permanently authorize the fund and make its funding mandatory. The Finance chairman came close to securing two years of guaranteed funding for the program in the 2012 surface transportation authorization (PL 112-141) by linking the language to a provision creating a trust fund for Gulf Coast states affected by the 2010 BP oil spill.

The budgeting trick he devised to offset both pieces of the amendment won overwhelming support, with the amendment garnering 76 votes. But Senate Democrats were forced to give up on funding for the Land and Water Conservation Fund in conference to persuade Republicans to abandon their demands to mandate approval of the Keystone XL oil pipeline and roll back EPA regulations.

Landrieu has acknowledged the conservation fund’s significance but is concerned about efforts to shift the program to mandatory spending. She contends oil and gas production off the shores of Gulf states pays to preserve resources thousands of miles away — while coastal states face their own conservation issues.

“We’re saving the redwoods … and the sequoias, but we’re not saving the marsh where the revenues are coming from,” Landrieu said at a hearing last month.

But a Senate aide said any expansion of revenue sharing for coastal states will have to be paired with a boost in funding for the rest of the country.

“There’s no way increased revenue sharing will be able to gain traction in the Senate without including benefits for interior states through a program like [the Land and Water Conservation Fund],” the aide said.

While conservation lobbyists seek out legislative vehicles for a broader overhaul, the more immediate spending fight will play out in debates over the House and Senate fiscal 2014 Interior-Environment appropriations bills. The House panel is expected to release its draft this month, which will be written with a $24.3 billion top-line figure.

House appropriators sought to fund the program at $66 million in fiscal 2013, an 80 percent cut from the previous year and the lowest funding level since the program’s creation in 1965. Still, the fund enjoys some support even among Republican appropriators, making the proposed funding level more a bargaining chip with the Senate than a policy statement against the program. Advocates hope the underlying support can ultimately lead to the overhaul they are seeking.

“Much like an endowment, if we responsibly put enough resources in the fund upfront, it becomes self-sustaining,” a Baucus aide said. “The underlying policy logic is sound.”

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