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Bipartisan Senate Coalition Support Fair Sharing of Oil Revenue with Coastal States

Press Release

Location: Washington, DC

A bipartisan group of 24 U.S. Senators today expressed their support for allowing coastal states to share in a fair portion of the revenues from energy production in the outer Continental Shelf (OCS). In a letter to all 100 Senators, these 24 Senators urged their colleagues to support a revenue sharing plan that recognizes the role that coastal states play in hosting offshore oil and gas exploration.

Joining Senator George Lemieux (R-FL) were Senators Mary L. Landrieu (D-LA), Lisa Murkowski (R-AK), Richard Burr (R-NC), Mark Begich (D-AK), Saxby Chambliss (R-GA), Jeff Sessions (R-AL), Kay Hagan (D-NC), Jim Webb (D-VA), Robert Bennett (R-UT), Lamar Alexander (R-SC), David Vitter (R- LA), John Cornyn (R-TX), George Voinovich (R- OH), John McCain (R-AZ), Kay Bailey Hutchison (R-TX), Richard Shelby (R-AL), Jim Inhofe (R-OK), Lindsey Graham (R-SC), Tom Coburn (R-OK), Thad Cochran (R-MS), Roger Wicker (R-MS), and Sam Brownback (R-KS).

"Each of us and our constituents hold varying views on offshore energy production in the federal waters seaward of our states," the Senators wrote. "We make no collective statement on such production -- some of us would favor it and some of us would not necessarily favor it. We are united, however, in our position that any such production in federal waters must include a program in which affected coastal states and coastal political subdivisions are entitled to a share of the federal revenues resulting from such production."

Since 1933, offshore oil and gas production has generated over $165 billion in revenue for the federal treasury -- the second largest source of federal revenue after income taxes. This revenue currently bypasses coastal states and goes directly to the Federal Treasury, even as the coastal environment is severely impacted by energy development. However, states that host onshore energy production on federal lands receive 50 percent of the revenues as compensation for the impacts, and have since 1920.

"All of our states are shouldered with fiscal challenges similar to those of the federal government," the Senators wrote. "States also face hard choices regarding the balance between local costs and national benefits. Should Congress enact laws that would have coastal states host more production of the OCS, it is important to consider the local impacts. OCS production places vastly heightened demands on transportation services, ports, fuel supplies, pipeline corridors, public health and safety, and other infrastructural and social resources. There are also associated risks, actual and perceived, to coastal economies in terms of fisheries, tourism, recreation, and wildlife habitat. As the Gulf Spill shows, production in federal waters beyond three miles from shore can have even greater impacts than production in near-shore state waters."

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