Offshore Drilling: Whither State Influence?

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David B. Spence*

The Trump Administration recently announced its intention to consider opening large swaths of the Atlantic, Pacific and eastern Gulf coasts for oil and gas production. Understandably this has unnerved people in the affected states.  But far more troubling than the proposal itself is what it portends: the possible end of a long-standing norm of deferring to states when it comes to leasing for oil and gas production on the other continental shelf. 

There are tall hurdles in the path of the Administration's leasing proposal.  Even without litigation, the leasing process is so protracted that implementing the Administration's plan will require the cooperation of future administrations – cooperation that may not be forthcoming.  The acreage ultimately put up for lease will be a small fraction of that described in the proposal. And litigation will almost certainly slow or stall the plan, in any event. 

Most coastal states (outside the western Gulf of Mexico and Alaska) have tended to oppose drilling off their coasts for economic and environmental reasons. Laws enacted in the wake of the 1969 Santa Barbara oil spill give those states some legal leverage over offshore development: they have the right to be consulted in the leasing process, and the Coastal Zone Management Act gives them a qualified veto over offshore development, albeit one that can be overturned by the Secretary of Commerce. A suite of other environmental laws offer opponents of offshore development additional bites at the apple.

But legal fights to the death over leasing have been rare.  Instead, presidents have tended to defer to the wishes of states when it comes to leasing for oil and gas production offshore.  A combination of congressional and executive branch moratoria have sometimes codified these agreements, keeping the Atlantic, Pacific and eastern Gulf coasts off limits to new drilling.

This has been a bipartisan norm. For example, even the fossil fuel-friendly administration of George W. Bush declined to open the oil-rich waters off southern California or the west coast of Florida to leasing.  And when state leaders in Virginia, New Jersey, and North Carolina briefly supported offshore development, the Department of Interior under both Republican and Democratic presidents considered leasing offshore acreage there, before abandoning those plans when state support waned. 

Will this bipartisan norm of deference to states continue?  Maybe not.

Republicans’ seem more willing than ever to make and apply the law in a more boldly partisan fashion.  The GOP Congress' recent tax bill targets Democrats and blue states so disproportionately that some politicians and scholars question its constitutionality.  Some view Attorney General Jeff Sessions' recent decision to oppose state marijuana legalization as part of an Administration war on blue states. Some analysts see the Administration's oil and gas leasing proposal through this same partisan prism.

If so, why did the original proposal include acreage off the southeast Atlantic and the Florida Gulf coasts, areas represented by Republican politicians who also oppose drilling?  This is the “everybody hates it so it must not be partisan” defense. 

But there are already disturbing signs that the Administration’s leasing plan may be implemented in a partisan fashion. Shortly after its announcement Secretary of the Interior Zinke heard objections from Florida's Republican Governor Rick Scott and decided to remove offshore Florida tracts from the plan. Many are rightly skeptical that he will afford the same courtesy to the Democratic governors of California or North Carolina?

In any case, the proposal abandons a long-standing bipartisan norm of deference to the states in offshore oil and gas development.  If it is administered in a partisan way, that will represent yet-another Trump Administration insult to our rule-of-law tradition.  Both developments would be mistakes. 

*David B. Spence is a professor of energy law at the University of Texas at Austin.

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Jan. 12, 2018