[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
H.R. 33: IMPOSING CERTAIN RESTRICTIONS AND REQUIREMENTS ON THE LEASING 
UNDER THE OUTER CONTINENTAL SHELF LANDS ACT OF LANDS OFFSHORE FLORIDA, 
                         AND FOR OTHER PURPOSES

=======================================================================

                                HEARING

                               before the

                         SUBCOMMITTEE ON ENERGY
                         AND MINERAL RESOURCES

                                 of the

                         COMMITTEE ON RESOURCES
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                     AUGUST 5, 1999, WASHINGTON, DC

                               __________

                           Serial No. 106-54

                               __________

           Printed for the use of the Committee on Resources


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house
                                   or
           Committee address: http://www.house.gov/resources

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
61-247                      WASHINGTON : 1999



                         COMMITTEE ON RESOURCES

                      DON YOUNG, Alaska, Chairman
W.J. (BILLY) TAUZIN, Louisiana       GEORGE MILLER, California
JAMES V. HANSEN, Utah                NICK J. RAHALL II, West Virginia
JIM SAXTON, New Jersey               BRUCE F. VENTO, Minnesota
ELTON GALLEGLY, California           DALE E. KILDEE, Michigan
JOHN J. DUNCAN, Jr., Tennessee       PETER A. DeFAZIO, Oregon
JOEL HEFLEY, Colorado                ENI F.H. FALEOMAVAEGA, American 
JOHN T. DOOLITTLE, California            Samoa
WAYNE T. GILCHREST, Maryland         NEIL ABERCROMBIE, Hawaii
KEN CALVERT, California              SOLOMON P. ORTIZ, Texas
RICHARD W. POMBO, California         OWEN B. PICKETT, Virginia
BARBARA CUBIN, Wyoming               FRANK PALLONE, Jr., New Jersey
HELEN CHENOWETH-HAGE, Idaho          CALVIN M. DOOLEY, California
GEORGE P. RADANOVICH, California     CARLOS A. ROMERO-BARCELO, Puerto 
WALTER B. JONES, Jr., North              Rico
    Carolina                         ROBERT A. UNDERWOOD, Guam
WILLIAM M. (MAC) THORNBERRY, Texas   PATRICK J. KENNEDY, Rhode Island
CHRIS CANNON, Utah                   ADAM SMITH, Washington
KEVIN BRADY, Texas                   CHRIS JOHN, Louisiana
JOHN PETERSON, Pennsylvania          DONNA MC CHRISTENSEN, Virgin 
RICK HILL, Montana                       Islands
BOB SCHAFFER, Colorado               RON KIND, Wisconsin
JIM GIBBONS, Nevada                  JAY INSLEE, Washington
MARK E. SOUDER, Indiana              GRACE F. NAPOLITANO, California
GREG WALDEN, Oregon                  TOM UDALL, New Mexico
DON SHERWOOD, Pennsylvania           MARK UDALL, Colorado
ROBIN HAYES, North Carolina          JOSEPH CROWLEY, New York
MIKE SIMPSON, Idaho                  RUSH D. HOLT, New Jersey
THOMAS G. TANCREDO, Colorado

                     Lloyd A. Jones, Chief of Staff
                   Elizabeth Megginson, Chief Counsel
              Christine Kennedy, Chief Clerk/Administrator
                John Lawrence, Democratic Staff Director
                                 ------                                

              Subcommittee on Energy and Mineral Resources

                    BARBARA CUBIN, Wyoming, Chairman
W.J. (BILLY) TAUZIN, Louisiana       ROBERT A. UNDERWOOD, Guam
WILLIAM M. (MAC) THORNBERRY, Texas   NICK J. RAHALL II, West Virginia
CHRIS CANNON, Utah                   ENI F.H. FALEOMAVAEGA, American 
KEVIN BRADY, Texas                       Samoa
BOB SCHAFFER, Colorado               SOLOMON P. ORTIZ, Texas
JIM GIBBONS, Nevada                  CALVIN M. DOOLEY, California
GREG WALDEN, Oregon                  PATRICK J. KENNEDY, Rhode Island
THOMAS G. TANCREDO, Colorado         CHRIS JOHN, Louisiana
                                     JAY INSLEE, Washington
                    Bill Condit, Professional Staff
                     Mike Henry, Professional Staff
                  Deborah Lanzone, Professional Staff



                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held August 5, 1999......................................     1

Statements of Members:
    Cubin, Hon. Barbara, a Representative in Congress from the 
      State of Wyoming...........................................     1
        Prepared statement of....................................     2
    Underwood, Hon. Robert A., a Delegate in Congress from the 
      U.S. Territory of Guam.....................................    13
        Prepared statement of....................................    13
    Goss, Hon. Porter J., a Representative in Congress from the 
      State of Florida...........................................    14
        Prepared statement of....................................    15

Statements of witnesses:
    Bedell, Charles A., Murphy Exploration and Production 
      Company, National Ocean Industries Association; American 
      Petroleum Institute; U.S. Oil and Gas Association; 
      Independent Petroleum Association of America; Domestic 
      Petroleum Council; NAD International Association of 
      Drilling Contractors.......................................    52
        Prepared statement of....................................    00
    Hakes, Jay, Administrator, Energy Information Administration, 
      U.S. Department of Energy..................................    38
        Prepared statement of....................................    00
    Joyner, Mike, Director, Legislative and Governmental Affairs, 
      the Florida Department of Environmental Protection.........    17
        Prepared statement of....................................    19
    Rosenbusch, Walt, Director of Minerals Management Service, 
      U.S. Department of the Interior;...........................    28
        Prepared statement of....................................    29

Additional material supplied:
    Text of H.R. 33..............................................     4
    Coalition for Sustainable Resources, Inc, prepared statement 
      of.........................................................    57



 HEARING ON H.R. 33: IMPOSING CERTAIN RESTRICTIONS AND REQUIREMENTS ON 
   THE LEASING UNDER THE OUTER CONTINENTAL SHELF LANDS ACT OF LANDS 
                OFFSHORE FLORIDA, AND FOR OTHER PURPOSES

                              ----------                              


                        THURSDAY, august 5, 1999

              House of Representatives,    
                         Subcommittee on Energy    
                                   & Mineral Resources,    
                                    Committee on Resources,
                                                    Washington, DC.
    The Subcommitte met, pusuant to call, at 2:03 p.m., in Room 
1324, Longworth House Office Building, Hon. Barbara Cubin 
[chairman of the Subcommittee] presiding.

 STATEMENT OF HON. BARBARA CUBIN, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF WYOMING

    Mrs. Cubin. The Subcommittee on Energy and Minerals--
Mineral Resources will please come to order. The Subcommittee 
on Energy and Mineral Resources meets today to take testimony 
on a bill introduced by Congressman Porter Goss of the 14th 
congressional district of Florida. H.R. 33 is a bill imposing 
certain restrictions and requirements on the leasing under the 
outer continental shelf lands off the shore of Florida, 
obviously. Mr. Goss has introduced this measure for several 
Congresses now. Twice, previously, he has appeared before the 
Subcommittee, when we have held oversight hearings on the issue 
of moratoria on OCS oil and gas leasing. But, today is the 
first time that we have sought testimony on his bill per se, so 
I know that he feels like he's making huge progress.
    We will hear the administration's views, as well as those 
of the State of Florida and the petroleum industry. Basically, 
H.R. 33 directs the establishment of a joint Federal-state task 
force and mandates the preparation of assessments, studies, and 
research, all to be received by the task force before the 
Secretary of Interior may carry out his responsibilities under 
the OCS LA, regarding oil and gas leasing offshore of the State 
of Florida. Although the bill encompasses the entire Federal 
OCS from the Florida line and the Atlantic around the Florida 
Keys and Florida Bay into the Gulf of Mexico to the Alabama 
border, much of which is already under a moratoria in one 
fashion or another, but the eastern Gulf of Mexico planning 
area, especially the portion adjacent to the very productive 
central planning area, is not. However, the current five-year 
program plan of the MMS, the document which prescribes the pace 
and progression of the leases sales, shows but one sale for the 
eastern Gulf and that is not until late in the year 2001.
    Yes, there are already issued leases and even a few with 
commercial discoveries of hydrocarbons within the eastern Gulf 
planning area, but the Coastal Zone Management Act provides 
opportunity for the State of Florida Government to comment upon 
Interior Department approvals or denials of proposed drilling 
or development plans. Of course, the issue boils down to just 
how much deference, if any, the Feds should give the governor 
of a state on OCS leasing decisions off that state shoreline.
    My colleagues and I from the western states here over and 
over again, in the course of debates with many members 
representing non-public land states, that these are all Federal 
lands, you know; my constituents own them just as much as you 
do. Well, Federal oil and gas development of one's coastline is 
not unlike my situation and I'd like to support even partial 
devolution of authority to coastal state governors 
participating in Federal OCS decision-making. But, I see very 
little reciprocity of this thinking, when it comes to 
empowering my governor to be an equal partner with the Feds, 
when it comes to shaping grazing, timber, mining, and oil and 
gas, and other public land policies. Furthermore, although 
Wyoming has a bountiful endowment of mineral resources on our 
public lands, it is still far behind the Gulf of Mexico OCS in 
the dollar value of those assets flowing to the Treasury.
    My constituents need to know that decisions we make here in 
Congress affecting this rather substantial revenue stream are 
soundly supported by objective science. We ask no less of the 
Secretary of Interior, when he's putting wolves and grizzly 
bears in our backyard, but we don't always get it.
    Let me finish with the observation that the Land and Water 
Conservation Fund is a pot of money that is drawing 
particularly strong interest this year. There are several 
competing proposals in Congress and the Clinton administration 
has ideas as well, all looking to put OCS receipts to work 
purchasing environmentally sensitive lands, conserving habitat, 
and building recreational facilities. But, we must remember 
from where those dollars flow. It is the well bore of a 
producing oil and gas lease. No leasing means no drilling, 
which means no production, which means no replenishment of the 
Land and Water Conservation Fund account. There is no free 
lunch.
    I now recognize the Ranking Member for any opening 
statement he may have.
    [The prepared statement of Mrs. Cubin follows:]

Statement of Hon. Barbara Cubin, a Represetntative in Congress from the 
                            State of Wyoming

    The Subcommittee on Energy and Minerals meets today to take 
testimony on a bill introduced by Congressman Porter Goss of 
the 14th Congressional District of Florida. H.R. 33 is a bill 
imposing certain restrictions and requirements on the leasing 
under the Outer Continental Shelf Lands Act of lands offshore 
of Florida, and for other purposes.
    Mr. Goss has introduced this measure for several Congresses 
now. Twice previously he has appeared before the Subcommittee 
when we have held oversight hearings on the issue of moratoria 
on OCS oil and gas leasing. But today is the first time we have 
sought testimony on his bill, per se. We will hear the 
Administration's views as well as those of the State of Florida 
and the petroleum industry.
    Basically, H.R. 33 directs the establishment of a joint 
Federal-state task force and mandates the preparation of 
assessments, studies and research, all to be reviewed by the 
task force, before the Secretary of the Interior may carry out 
his responsibilities under the OCSLA regarding oil and gas 
leasing offshore of the State of Florida. Although the bill 
encompasses the entire Federal OCS from the Georgia line in the 
Atlantic around the Florida Keys and Florida Bay into the Gulf 
of Mexico to the Alabama border, much of this area is already 
under a moratorium in one fashion or another. But the eastern 
Gulf of Mexico planning area, especially that portion adjacent 
to the very productive central planning area, is not. However, 
the current 5-year program plan of the Minerals Management 
Service, the document which prescribes the pace and progression 
of lease sales, shows but one sale for the eastern Gulf and 
that is not until late in the year 2001.
    Yes, there are some already issued leases and even a few 
with commercial discoveries of hydrocarbons within the eastern 
Gulf planning area. But, the Coastal Zone Management Act 
provides opportunity for the State of Florida government to 
comment upon Interior Department approvals (or denials) of 
proposed drilling or development plans. Of course, the issue 
boils down to just how much deference, if any, the feds should 
give to the Governor of a state on OCS leasing decisions off 
that state's shoreline.
    My colleagues and I from western States hear over and over 
again in the course of debates with from Members representing 
non-public land states ``These are Federal lands, you know. My 
constituents own them just as much as yours do.'' Well, Federal 
oil and gas development of one's coastline is not unlike my 
situation. Now, I'd like to support even partial devolution of 
authority to coastal state Governors participating in Federal 
OCS decisionmaking. But I see very little reciprocity of this 
thinking when it comes to empowering my Governor to be an equal 
partner with the feds when it comes to shaping grazing, timber, 
mining, oil & gas and other public land policies in Wyoming.
    Furthermore, although Wyoming has a bountiful endowment of 
mineral resources on our public lands, it still is far behind 
the Gulf of Mexico OCS in the dollar value of those assets 
flowing to the Treasury. My constituents need to know that 
decisions we make here in Congress affecting this rather 
substantial revenue stream are soundly supported by objective 
science. We ask no less of the Secretary of the Interior when 
he's putting wolves and grizzly bears in our backyard--but we 
don't always get it.
    Let me finish with the observation that the Land & Water 
Conservation Fund is a pot of money that is drawing 
particularly strong interest this year. There are several 
competing proposals in Congress and Clinton Administration 
ideas, as well, all looking to put OCS receipts to work 
purchasing environmentally sensitive lands, conserving habitat 
and building recreational facilities. But, we must remember 
from where those dollars flow--its the well bore of a producing 
oil and gas lease. No leasing means no drilling, which means no 
production, which means no replenishment of the LWCF account. 
There is no free lunch.

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 STATEMENT OF HON. ROBERT A. UNDERWOOD, A DELEGATE IN CONGRESS 
                FROM THE U.S. TERRITORY OF GUAM

    Mr. Underwood. Madame Chair, I thank you for holding 
today's hearing on our colleague Congressman Porter Goss's 
bill, H.R. 33, a bill that would impose restrictions and 
requirements on the leasing and development of certain outer 
continental shelf leases located off the coast of Florida. I 
understand Mr. Goss introduced this legislation in the 105th 
Congress, although the Committee did not take action on that 
bill.
    The OCS program is a major source of energy for the nation, 
currently providing about 18 percent of our total domestic 
production of oil and 27 percent of our production of natural 
gas; but, as is evidenced in Florida, it is not without 
controversy. As a result of the conflicts that have accompanied 
development of these resources, both the Congress and the 
President have imposed moratoria on new leasing and development 
in certain areas of the nation's OCS, including Florida. The 
Clinton Administration, like the Bush administration before it, 
supports the moratorium on oil and gas leasing off the Florida 
coastline. The requirement OCS five-year oil and gas program, 
covering the 1997 to 2002 period, excludes all areas included 
in the congressional restrictions from leasing consideration. 
In addition, President Clinton has excluded the area from 
leasing outside the eastern Gulf of Mexico until 2012.
    In closing, let me say that I appreciate and support the 
intent of the concept proposed by Mr. Goss. If the State of 
Florida and its citizens are opposed to oil and gas development 
off of its coastline, the Federal government should respect 
that, even in Federal waters. However, the administration has 
legitimate concerns, which I'm sure we'll hear later, related 
to cost duplication of effort and legal implications that 
should be answered before the Subcommittee disposes of this 
bill. With that in mind, I look forward to hearing from our 
witnesses today. Thank you.
    Mrs. Cubin. Thank you, Mr. Underwood. Let me remind the 
witnesses that they must limit their oral testimony to five 
minutes, but that their entire statement will be put in the 
record. Also, let me mention that these hearings are now 
broadcast live over the Internet and there is an on/off switch 
on your microphones for your use in controlling the privacy of 
any whispering that you might want to be doing back there.
    So, with that, I'd like to ask for--first of all, welcome 
Congressman Goss to the Subcommittee again this year and I look 
forward to your testimony.
    [The prepared statement on Mr. Underwood follows:]

 Statement of Hon. Robert Underwood, a Delegeate in Congress from the 
                           Territory of Guam

    Madam Chair, thank you for holding today's hearing on our 
colleague, Congressman Porter Goss's bill, H.R. 33, a bill that 
would impose restrictions and requirements on the leasing and 
development of certain Outer Continental Shelf [OCS] leases 
located off the coast of Florida. I understand Mr. Goss 
introduced this legislation in the 105th Congress, although the 
Committee did not take action on that bill.
    The OCS program is a major source of energy for the Nation, 
currently providing about 18 percent of our total domestic 
production of oil and 27 percent of our production of natural 
gas, but, as is evidenced in Florida, it is not without 
controversy. As a result of the conflicts that have accompanied 
development of these resources, both the Congress and the 
President have imposed moratoria on new leasing and development 
in certain areas of our Nation's OCS, including Florida.
    The Clinton Administration, like the Bush Administration 
before it, supports the moratorium on oil and gas leasing off 
the Florida coastline. The required OCS 5-Year Oil and Gas 
Program, covering the 1997-2002 period, excludes all areas 
included in the congressional restrictions from leasing 
consideration. In addition, President Clinton has excluded the 
area from leasing outside the eastern Gulf of Mexico until 
2012.
    In closing, let me say, that I appreciate the intent of the 
concept proposed by Mr. Goss. lf the State of Florida and its 
citizens are opposed to oil and gas development off its 
coastline, the Federal Government should respect that--even in 
Federal waters. However, the Administration has legitimate 
concerns related to cost, duplication of effort and legal 
implications that should be answered before this Subcommittee 
can responsibly dispose of the bill. With that in mind, I look 
forward to hearing from our witnesses today.

STATEMENT OF HON. PORTER J. GOSS, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF FLORIDA

    Mr. Goss. Thank you, very much, Madame Chairwoman. I assure 
you, I have nothing to hide and whisper about. I'm very proud 
of this legislation. I'm extremely grateful to you and your 
Subcommittee for having this hearing. As you know, this is a 
quest not of mine, but of the people of Florida and the entire 
Florida delegation, and we believe we are leading the way, 
actually, for other states and other areas that have had 
similar concerns. And I would certainly say I well heard and am 
very receptive to your remarks about your beautiful state. I 
would point out there are some vast differences between our 
states: the highest point above sea level in my hometown is 14 
feet above sea level; I suspect a slightly different statistic 
from where you live.
    But the point is, it's the same and I would be very happy 
to join you in this approach, because we think this is a good 
approach that we have, to try and make decisions that are 
important decisions for both the country and the state and base 
those decisions on good fact, rather than on political pressure 
or who's got the loudest voice or whatever other criteria might 
be in play. So what we have got here is a situation well 
explained in my prepared remarks, which I will just summarize 
very quickly.
    We've got an annual moratorium, which we've affected by 
putting a rider on an appropriations bill since 1983. That is a 
very bizarre way to handle what is a legitimate challenge that 
ought to be worked out by wise people with interest in this to 
come to a conclusion that has more certainty and more 
efficiency. And that's what we are proposing, setting up such a 
mechanism. We're calling it a joint Federal-state OCS task 
force and the composition of that task force, we have made a 
recommendation. I don't pretend to have total prescience or 
wisdom on that point. We felt it was a good balance the way we 
set it up. If there are other recommendations, obviously, we're 
receptive.
    The point is right now, we are losing something by having 
this annual moratorium, in addition to time--legislative time 
in Congress. We find that Florida does have some protection 
against future leases, but not against the existing leases and 
there are property rights that go with those leases. So, we 
would like to deal with making a good decision not only with 
future, but how do we deal with the problem we have today. And 
I assure you, that's of great interest to the citizens and the 
government of Florida today. And equally, the oil and gas 
industry does have several existing leases, which they paid 
good, hard dollars for, and they're unable to develop long-term 
strategy and plans to determine the viability and the 
exploitation of those leases, and that is, of course, unfair. 
So what we are trying to do is to go forward from that position 
and set up a process, where we can make good decisions that 
will remove those problems and create benefits for all 
interested parties.
    We agree on certain things, and when I say ``we,'' it's the 
people of Florida. And I'm not talking environmentalist or 
business or government or local government or rural farm owner 
or beach front dweller; I'm talking about everybody in Florida 
pretty much agrees that if we had an oil spill, it would have a 
devastating impact on our economy, given the basis of our 
economy being pretty much our beaches and shores, the tourism, 
and all the service industry, and relocation and growth of 
residents that goes with that.
    The second thing we pretty much all agree on is that we 
don't have the necessary scientific data about the eastern Gulf 
and, in fact, other waters, whether they are properly state 
waters. And the boundary changes on one side of Florida and 
it's different on the other side, because of the--we're dealing 
with the Atlantic Ocean on one side and Gulf of Mexico on the 
other and different historical precedence of our we got there. 
But, the fact is, whether the water is Florida, American, 
Federal, or something that doesn't bother most people, they 
want to have the quality of water and they want to have it 
protected and they want to have a good beach experience. And 
the desire to maintain a good environment is real and the 
desire to maintain a viable economy is real, and they're both 
entirely legitimate and fall within our government purview and 
what we're about up here.
    I think it is very important to state that we understand 
that this bill, as presented to you, is an improvement on the 
annual moratorium system, which is probably driving the 
appropriators crazy and it's certainly driving the rules 
committee crazy, because we don't like doing that, as you know, 
in the rules committee. There's been question that the Land and 
Water Conservation Fund could be affected. Yes, it could, and 
that should be part of the scientific findings, because we are 
not interested in doing anything, except creating some 
certainty for the business interest, and I think we do that on 
the basis of a factual examination of what we can do.
    I'm aware there are some concerns about national security. 
Believe me, I do pay a lot of attention to national security, 
as you well know, and I understand that we need to take that 
into the formula for the reserves that may be in the Gulf of 
Mexico to deal with that, in the event that other sources of 
oil and gas are shut off.
    All of those questions, I think are timely and it's time to 
face them straightforward and that's why I bring this forward. 
And I very much appreciate the opportunity to testify and we 
welcome any questions.
    [The prepared statement of Mr. Goss follows:]

Statement of Hon. Porter J. Goss, a Representative in Congress from the 
                            State of Florida

    Madame Chairman, I appreciate the opportunity to appear 
before you this afternoon. I commend the panel for holding this 
hearing. The issue of outer continental shelf oil and gas 
exploration moratoria is a vital one for Florida and many other 
coastal states. I would like to discuss this issue from 
Florida's perspective, and make the case for H.R. 33, a bill 
that I have again introduced as a proposed solution to the 
existing Florida OCS stalemate. I am particularly pleased that 
the Committee has invited Mr. Michael Joyner of the Florida 
Department of Environmental Protection, to testify about this 
proposal. I look forward to his testimony.
    As you know, each year Congress enacts restrictions on oil 
and gas activities in the eastern Gulf of Mexico as part of the 
Interior Appropriations bill. Florida's OCS moratorium was 
instituted in 1983, by our colleague, Rep. Bill Young, and it 
accomplished its goal as a short-term fix to protect the 
Florida coastline from a possible expansion of oil and gas 
exploration. I would note that this moratorium has enjoyed 
unanimous support from Florida's Congressional delegation. 
However, it was never intended to be a long term solution and I 
believe it fails to satisfy the interests of both parties to 
this debate: Florida is only protected against new oil and gas 
leases, while the oil industry is left holding several existing 
leases but without the ability to make any long-term 
exploration and development plans in the Eastern Gulf. I think 
that, fifteen years later, everyone realizes we need to find a 
better way to do business.
    Floridians oppose offshore oil drilling because of the 
threat it presents to the state's greatest natural and economic 
resources: our coastal environment. Florida's beaches, 
fisheries, and wildlife draw millions of tourists each year 
from all over the globe, supporting our state's largest 
industry. Tourism supports, directly or indirectly, millions of 
jobs all across Florida, and the industry generates billions of 
dollars every year. A 1990 study by Lee County estimates that a 
major blowout/oil spill could cost the economy of Lee County 
alone some $590 million in lost revenue. This translates into a 
loss of 12,300 jobs. Also, the on-shore facilities required to 
process the oil would likely change the character of the 
Florida coast, possibly contribute to the pollution of the 
environment, and pose serious problems for Florida's tourism 
and real estate industries.
    Concern about this issue is not limited to our business 
community--there are several grass-roots groups who are 
dedicated to preserving and protecting our coastline. There is 
a petition and letter writing campaign in my district run by 
Marge and David Ward of the Citizens Association of Bonita 
Beach. The Wards'tireless efforts have yielded over 30,000 
signatures opposed to drilling off Florida's coast, and they 
have generated letters of support from local chambers of 
commerce, government, and elected officials.
    The Florida coastline boasts some of the richest estuarine 
areas in the world. These brackish waters, with their mangrove 
forests and seagrass beds provide an irreplaceable link in the 
life of many species, both marine and terrestrial. Florida's 
commercial fishing industry relies on these estuaries because 
they support the nurseries for most commercially harvested 
fish. Perhaps the most environmentally delicate regions in the 
Gulf, estuaries could be damaged beyond repair by a relatively 
small oil spill.
    H.R. 33 was developed after extensive consultation with the 
state of Florida. It was supported by Governor Chiles and I am 
pleased to report that our new Governor, Jeb Bush, has also 
enthusiastically endorsed the proposal. In addition, the bill 
has a wide range of support among both the public and private 
sector in the state. I am particularly pleased to report that 
every single member of the Florida Congressional delegation has 
cosponsored H.R. 33, as in past Congresses.
    This legislation was introduced to provide for a ``time 
out'' period during which no new leasing or drilling could take 
place in Federal waters off Florida's coast. During this 
period, a joint Federal-state task force would review the 
available scientific and environmental studies and (if 
necessary) recommend further ones. Once the joint task force 
determines that an adequate base of data exists, it would 
recommend what areas (if any) off Florida could safely sustain 
oil and gas exploration and production.
    The benefits of this approach include:

     the opportunity to develop a more precise policy than 
afforded under the current moratorium, which must be renewed by 
Congress each year. This should provide the oil industry with greater 
certainty and an ability to plan in the context of a long-term 
strategy; and
     a central role for the State of Florida in a decision with 
great impact on our state--even though that decision would apply to 
waters under the jurisdiction of the Federal Government; and
     a decision that accurately reflects scientific rather than 
political pressures.
    I recognize that some concerns have been raised about this 
proposal and I would like to take a moment to discuss some of 
those issues. First, the question I hear most often is why do 
we need to pass this legislation, when it is very likely 
Congress will continue to enact the annual moratorium, as it 
has for fifteen years. As I mentioned earlier, I believe the 
moratorium provides a short-term way to deal with this issue, 
but, in the long-run, it shortchanges both the State of Florida 
and the oil industry. I believe both parties would benefit from 
a scientifically crafted long-term approach to management of 
the Eastern Gulf. In addition, from a process perspective, I 
would prefer not to address substantive legislative issues 
through ``riders'' to an appropriations bill.
    In addition, I have also heard concerns about the effect of 
H.R. 33 on revenues for the Land and Water Conservation Fund 
(LWCF), the principal source of Federal funds for land 
acquisitions by the National Park Service, the Bureau of Land 
Management, the U.S. Fish and Wildlife Service and the U.S. 
Forest Service. The LWCF is funded by revenues from Federal 
outdoor recreation user fees, the Federal motorboat fuel tax, 
property sales and from oil and gas leases on the Outer 
Continental Shelf. As the Subcommittee is well aware, OCS 
revenues have accounted for more than 90 percent of the 
deposits in the LWCF, and, in some years, almost all deposits 
to this fund. I agree that the effect of H.R. 33 on revenues 
for LWCF is a critically important question, particularly given 
Federal land acquisition in Florida. Since the current 
moratorium prohibits any new leases, it effectively forecloses 
the possibility of future contributions to the fund from OCS 
activities in the Eastern Gulf of Mexico. If we continue our 
current approach--adopting the moratorium each year--that won't 
change. The joint-task force created by H.R. 33 would be 
charged with making a scientific decision on OCS activities in 
the Eastern Gulf and their recommendations would effectively 
address the LWCF issue.
    Finally, I have heard concerns about the make-up of the 
joint task force provided for in H.R. 33. As drafted, the bill 
would create a task force consisting of one representative each 
from the Environmental Protection Agency, the Minerals 
Management Service, the National Oceanic and Atmospheric 
Administration, and the U.S. Fish and Wildlife Service; four 
representatives from the State of Florida appointed by the 
Governor; and three members appointed by the Secretary of 
Commerce based on nominations from the National Academy of 
Sciences who are professional scientists in the field of 
physical oceanography, marine ecology, and social science. 
Clearly, the intent is to provide a scientific panel while 
allowing input from the State of Florida. If the Subcommittee 
wants to reconsider this makeup, I would be happy to discuss 
that issue further.
    Finally, let me thank the Subcommittee for its indulgence 
in holding this hearing. I look forward to working with you on 
moving this proposal forward.
    Thank you again.

    Mrs. Cubin. Thank you, Mr. Goss. The Chair now recognizes 
Mike Joyner, Director of Legislative and Governmental Affairs 
for the Florida Department of Environmental Protection.

      STATEMENT OF MIKE JOYNER, DIRECTOR, LEGISLATIVE AND 
 GOVERNMENTAL AFFAIRS, THE FLORIDA DEPARTMENT OF ENVIRONMENTAL 
                           PROTECTION

    Mr. Joyner. Thank you, very much, and good afternoon, 
Madame Chairman and committee member. I am Mike Joyner, the 
Director of Legislative and Governmental Affairs for the 
Florida Department of Environmental Protection. Thanks, very 
much, for the opportunity to present testimony on behalf of 
Governor Bush and the citizens of the State of Florida, 
regarding Congressman Goss's outer continental shelf leasing 
restriction bill, H.R. 33. This legislation will assure that 
adequate environmental studies and completed--or completed, 
pardon me, resulting in a better understanding of environmental 
risks associated with OCS oil and gas activities. It is one of 
several bills that are pending that limits oil and gas 
activities off of the Nation's coast.
    The State of Florida has concerns over industrial 
activities associated with offshore oil and gas resource 
development that may negatively impact our coast. The Florida 
economy is based upon a warm climate, clean waters, and 
pristine natural areas. I think most of you know, you've 
probably all traveled to Florida, but environmental-related 
industry, such as recreation, tourism, commercial and 
recreational fishing, as well as agriculture, are major 
economic activities in Florida. Annually, Florida welcomes 
approximately 42 million visitors from around the world, which 
results in billions of dollars, obviously, to our state and 
local economy. Clearly, with the majority of the state's 
population deriving income from jobs related to our rich and 
diverse marine and coastal resources, the state cannot afford 
to risk an environmental or economic disaster. Governor Bush 
opposes drilling off of Florida and will continue to carefully 
scrutinize all coastal activities, to ensure that they do not 
interfere with the state's interest.
    Florida's coastal and marine environments, truly national 
treasures, provide an array of habitat, including offshore 
fishing grounds, productive estuaries, mangrove forests, sea 
grass beds, sandy white beaches and islands, and much of which 
are protected under state and federal preservation efforts. 
These coastal and marine resources are the foundation of 
Florida's economy and its quality of life. The state, often 
with federal assistance, strives to protect the self-sustaining 
resources for the benefit of our wildlife and those who live in 
and visit Florida.
    Clearly, there are no active leases or plans to lease areas 
off of Florida's Atlantic coast, again repeating some of the 
things that Congressman Goss said; please bear with me. 
Primarily, our primary interest in oil and gas development off 
of Florida remains in the eastern Gulf of Mexico, off the 
panhandle region. New leasing near Florida's coastline was 
terminated through the support of previous governors, the 
Florida cabinet, the Florida congressional delegation, and 
certainly with the help of the federal government. However, 
there are approximately 150 active leases, totaling 
approximately 1,350 square miles remaining in the eastern Gulf 
of Mexico and further development and production is being 
proposed just 25 miles off of Florida's coast.
    The National Academy of Science has completed their 
comprehensive review of the Mineral Management Service's 
environmental studies program with federal, state, and academic 
scientists, and they recommend that MMS conduct further 
studies. Any new leasing activities is alarming to those of us 
in Florida without completed environmental studies and 
analysis. While MMS has been working to rectify deficiencies 
identified by the Academy, progress in completing these studies 
has been somewhat slow. The MMS is presently conducting studies 
off the Florida panhandle. I'd also mention that a workshop is 
being planned for the fall, I think in October, a couple of 
months from now, to further identify and design ecological and 
physical oceanographic studies that are necessary for 
environmental analysis.
    It is important to remember that the eastern Gulf of Mexico 
is uniquely geographically and ecologically--or is unique, 
pardon me, geographically and ecologically from the central and 
western Gulf. The vast majority of the central and western Gulf 
areas consist of soft muddy bottoms, where the eastern Gulf is 
often composed of carbonate sands with scattered low rocky--low 
relief rocky bottoms, which support subtropical plants and 
animals. Again, if you've been to Florida, you certainly have 
hopefully seen that firsthand. North America's only shallow 
water tropical reef system is found off of Florida and can be 
influenced by activities occurring in the Gulf of Mexico; 
again, Key West, an area I used to visit often growing up in 
Florida.
    Information learned from many years of oil and gas 
activities offshore Texas and Louisiana often unfortunately 
cannot be extrapolated to predict and evaluate impacts, which 
could occur in Florida's eastern Gulf. Many scientists believe 
that estuary Gulf marine and coastal communities are not well 
adapted to understanding the adverse impacts associated with 
oil and gas development. Catastrophic events, such as oil 
spills, may be unlikely, but studies--and I'll wrap this up 
quickly--but studies must address this issue, as well as other 
long-term and cumulative environmental social impacts. These 
include issues such as physical disturbances caused by 
anchoring, pipeline placement and rig construction, a 
resuspension of bottom sediments, chronic pollution from 
discharge of drilling effluents, production effluents and 
accidental releases of other toxic materials, social and 
economic impacts, and certainly environmental and threatened 
species.
    Just a few more things. Without adequate environmental and 
socioeconomic information analysis, Florida has no assurances 
that OCS oil and gas activities can take place without causing 
irreparable harm to our natural and economic resources. It is 
premature to consider further exploration or precedent setting 
development and production in this undeveloped area until 
adequate environmental studies are completed and a better 
understanding of our environmental risk is known.
    Similar to H.R. 112, which I understand affects California, 
H.R. 33 prohibits additional leasing and exploration or 
development, until adequate body of science and environmental 
information is available. Congressman Goss will--Congressman 
Goss's bill, excuse me, will allow MMS to complete studies, 
which address concerns raised by both the National Academy and 
our State of Florida. We encourage the markup and the passage 
of H.R. 33.
    Finally, and in closing, Governor Bush and the State of 
Florida appreciate the opportunity to comment--or to submit 
comments and endorse Congressman Goss's bill. And on just a 
personal note, thanks, very much, I appreciate your courtesies.
    [The statement of Mr. Joyner follows:]

               Statement of Mike Joyner, State of Florida

    Good afternoon, Madame Chairman and Members of the 
Committee. I am Mike Joyner, Director of Legislative and 
Governmental Affairs with the Florida Department of 
Environmental Protection. Thank you for the opportunity to 
present testimony on behalf of Governor Jeb Bush and the 
citizens of Florida regarding Congressman Porter Goss' Outer 
Continental Shelf (OCS) leasing restriction bill, H.R. 33. This 
legislation will assure that adequate environmental studies are 
completed resulting in a better understanding of environmental 
risks associated with OCS oil and gas activities. It is one of 
several bills which are pending that limit oil and gas 
activities off the nation's coasts.
    The State of Florida has concerns over industrial 
activities associated with offshore oil and gas resources 
development that may negatively impact our coasts. The Florida 
economy is based upon its warm climate, clean waters and 
pristine natural areas. Environmental related industries, such 
as recreation, tourism, commercial and recreational fishing, as 
well as agriculture are major economic activities of Florida. 
Annually, Florida welcomes over 42 million tourists from around 
the world, resulting in billions of dollars added to our state 
and local economies. Clearly, with a majority of the state's 
population deriving income from jobs related to our rich and 
diverse marine and coastal resources, the state cannot afford 
to risk an environmental or economic disaster. Governor Bush 
opposes drilling off of Florida and will continue to carefully 
scrutinize all coastal activities to ensure that they do not 
interfere with the state's interests.
    Florida's coastal and marine environments, truly national 
treasures, provide an array of habitats including offshore 
fishing grounds, productive estuaries, mangrove forests, sea 
grass beds, sandy white beaches and barrier islands, much of 
which are protected under state and Federal preservation 
efforts. These coastal and marine resources are the foundation 
of Florida's economy and quality of life. The state, often with 
Federal assistance, strives to protect these self-sustaining 
resources for the benefit of our wildlife and those who live in 
and visit Florida.
    Currently, there are no active leases or plans to lease 
areas off Florida's Atlantic coast. Primary interest in oil and 
gas development off Florida remains in the eastern Gulf of 
Mexico off the panhandle region. New leasing near Florida 
coastline was terminated through the support of previous 
Governors, the Florida Cabinet, the Florida Congressional 
Delegation, and eventually the Federal Government. However, 
about 150 active leases totaling about 1,350 square miles 
remain in the eastern Gulf of Mexico and further development 
and production is being proposed just 25 miles off Florida. The 
National Academy of Sciences has completed their comprehensive 
review of the Minerals Management Service's (MMS) environmental 
studies program with Federal, state and academic scientists, 
and they recommended that the MMS conduct further studies. Any 
new leasing activity is alarming without completed 
environmental studies and analyses.
    While the MMS has been working to rectify deficiencies 
identified by the Academy, progress in completing these studies 
has been slow. The MMS is presently conducting studies off the 
Florida panhandle. A workshop is also being planned for the 
fall to further identify and design ecological and physical 
oceanographic studies that are necessary for environmental 
analyses. It is important to remember the eastern Gulf of 
Mexico is unique, geologically and ecologically from the 
central and western Gulf. The vast majority of the central and 
western Gulf consists of soft, muddy bottoms, where the eastern 
Gulf is often composed of carbonate sands with scattered low-
relief rocky bottoms which support sub-tropical plants and 
animals. North America's only shallow-water tropical coral reef 
system is found off of Florida and can be influenced by 
activities occurring in the Gulf of Mexico. Information learned 
from many years of oil and gas activities offshore Texas and 
Louisiana often cannot be extrapolated to predict and evaluate 
impacts which could occur in the Florida eastern Gulf. Many 
scientists believe that the eastern Gulf's marine and coastal 
communities are not well adapted to withstand the adverse 
impacts associated with oil and gas development.
    Catastrophic events such as oil spills may be unlikely, but 
studies must address this issue as well as other long-term and 
cumulative environmental and social effects. These include 
issues such as physical disturbances caused by anchoring, 
pipeline placement and rig construction; the resuspension of 
bottom sediments; chronic pollution from discharges of drilling 
effluents, production effluents, and accidental releases of 
other toxic materials; social and economic impacts; and 
endangered and threatened species.
    Without adequate environmental and socio-economic 
information and analyses, Florida has no assurances that OCS 
oil and gas activities can take place without causing 
irreparable harm to our natural and economic resources. It is 
premature to consider further exploration or precedent setting 
development and production in this undeveloped area, until 
adequate environmental studies are completed, and a better 
understanding of environmental risks is known.
    Similar to H.R. 112 affecting California, H.R. 33 prohibits 
additional leasing and, exploration or development until an 
adequate body of scientific and environmental information is 
available. Congressman Goss' bill would allow the MMS to 
complete studies which address concerns raised by both the 
National Academy and the state. We encourage the markup and 
passage of H.R. 33.
    Governor Jeb Bush and the State of Florida appreciate the 
opportunity to submit comments and endorse Congressman Goss' 
bill.

    Mrs. Cubin. Thank you for your testimony and thank you for 
being here, as well.
    I find myself in a situation that is somewhat 
uncomfortable, because I totally am committed to the idea that 
the states, the people that live in the states, the governors 
of the states ought to have a large say so in what happens 
around their--in your case, around your shores, and, in my 
case, on public lands. I wish the states actually had more say 
so in that.
    The position that I--I guess the line of questioning that I 
want to follow, this will be for you, Porter, the United States 
Coast Guard, as you know, maintains oil spill data for the 
federal government that is on the outer continental shelf. And 
the statistical summary of oil spill data that they have shows 
that vessel traffic is by far the more likely source of oil 
pollution into jurisdiction waters of the United States than 
are the platforms or the subsea pipelines or those kind of 
things. So, I know that that's one of the things that you would 
want to have studied in a scientific way.
    But what I want to ask you is something that I have run 
into in Wyoming. Sometimes, there's a mind set that people just 
have an idea this is bad. I'm going to speak of Crown Butte 
gold mine, where someone came out and said that developing that 
mine would ruin Yellowstone. Now, I personally, was not in 
favor of developing that mine; but, nonetheless, I'm convinced 
by scientific data that it wouldn't have ruined Yellowstone. 
But, there was no amount of scientific study, no amount of 
convincing that could have convinced many people in Wyoming 
that it would not hurt Yellowstone and that it would be okay. 
So I guess what I'm--and you mentioned that there are private 
property rights concerns here, as well.
    So is that the situation, do you think, with the folks 
along the shore to coast? Do you think that this study and the 
results--say they came back and said it wouldn't hurt the 
coast; it will hurt the coast more; they have vessels coming in 
and out. Do you think that will be accepted by the people? Will 
it really make any difference?
    Mr. Goss. I think that is absolutely the nugget of the 
issue. I think you sized it up very well. The answer is that we 
are going to be confronted with making decisions. What we want 
is there to be no losers and all winners in the process. I 
believe that's possible. You are absolutely right about vessel 
discharge. It is a huge problem in the Florida Straits, because 
there's a lot of tonnage that goes up and down there and it 
causes a lot of damage. As you know, we're in danger of losing 
the coral reef for that and other reasons. And it's one of a 
kind. There's no place else. Like you have scenery in your 
state that is no place else, we have the stuff which is no 
place else. The mangrove forest of Florida Bay and southwest 
Florida and the Everglades is absolutely one of a kind on the 
globe.
--------------
    ``. . . can you estimate what Florida's needs will be for 
the Land and Water Conservation Fund for the protection of the 
Everglades and other sensitive areas, say, for the next five or 
ten years?''
    We are in the process of developing a comprehensive land 
acquisition priority list for south Florida ecosystem 
restoration in response to a request from Congressman Regula. 
The Department of Environmental Protection, South Florida Water 
Management District and Executive Office of the Governor are 
working together to provide: (1) a list of all existing 
conservation land acquisition lands acquired to date; (2) a 
list of remaining lands needed; (3) an estimate of State and 
Water Management District projected expenditures: and (4) an 
estimate of unfunded needs. These lists should be finalized in 
October and we will forward them to you and your Committee at 
that time.
    The State of Florida has an unprecedented conservation land 
acquisition program. We have spent over $3 billion during the 
last ten years to acquire environmentally sensitive lands in 
Florida. Many of these acquisitions have been directed toward 
lands that help conserve and manage the Federal trust lands in 
Florida, particularly the greater Everglades ecosystem. 
Governor Jeb Bush and the Florida Legislature approved a 
successor program during the 1999 legislative session that will 
allow this legacy of conservation land acquisition to continue 
in Florida. We are poised to continue our outstanding 
partnership with the Federal Government for many years to come.

    And so we feel the responsibility to take care of it. It 
happens to be in a place called Florida and there happens to be 
a line built at the top of the peninsular and then there's some 
other states after that. But, this really is a national 
question, and I believe that the answer lies in saying, look, 
we're going to set up a system and we're going to get facts, so 
that when we sit down to debate these tough challenges and 
decisions we have to make, we are going to make the decisions 
that we have on the basis of fact.
    Now, I'm not saying that everybody is going to get the same 
message the whole time. But, right now, what we have is 
interested parties, and there are several, putting their--how 
do I say this--best foot forward all of the time and putting 
your best foot forward sometimes doesn't give you the whole 
picture to make a balanced decision. We are weighing private 
property rights, no question about that. We are weighing the 
wishes of the people, who live in Florida, their quality of 
life type decisions. That's what politicians do and public 
services therefore.
    I agree with you on the state's rights issue. I think that 
the sovereign State of Florida has a huge role in this, which 
is why we've tried to set up this joint mechanism; but, I, 
also, recognize that we're dealing with the waters of the 
United States of America. So, we've tried to collar a way that 
we can get all of these ingredients in one room, at the same 
time, lock the door, and come out with a solution--an agreement 
on how we are going to make the decisions on these challenges. 
That's what this is designed to do. It's not meant to tilt the 
playing field one way or the other.
    I have personally seen oil spills in places where you 
didn't know there are oil spills, because there wasn't much 
quality there to start with. I have seen other places where oil 
spills have wiped out acres of mangrove forest. In my own 
district, we do ship oil; we have oil. We're not hypocrites. We 
turn on our car. We run air conditioning in the summer, heat in 
the winter--infrequently heat in the winter, I would say. But, 
we need oil, too, and we recognize that the oil and gas people 
have a totally legitimate interest in this. We recognize the 
national security interest in this.
    I know very well, and to try to sum this up, that if you 
think of this as a zoning war--a zoning fight, what you want to 
do is you want to make sure that the neighborhood is happy and 
that you've honored all of the private property rights that are 
involved, the other rights of people. That's a tough decision. 
I would suggest that it is possible to exploit oil and gas off 
of the coast of Florida in some areas at a minimal risk, if 
it's done in a certain way. I think that's possible. I don't 
think there's any doubt. I think the gentleman from Louisiana 
could testify to that and others from Mississippi and Texas and 
so forth.
    We have a different kind of risk situation in some areas. 
That needs to be taken definitely into account. Additionally, 
we happen to have an economy in the state that is based on 
tourism, natural environment. We sell eco-tourism. We sell it 
for our growth, our quality of life. We're one of the fastest 
growing states in the union. People do not want to trade off 
the shore side facilities for what I will call, say, oil and 
gas refinery hardware, railroad trains.
    Now, some places have made that decision and they've done 
it. Galveston always comes to mind, in my discussions. 
Galveston is a place where they made that decision and that's 
what they do in Galveston. We've made the decision in Florida 
to try and do it the other way. I'm not so sure that we can't 
accommodate both; but, I won't know until we weigh all of the 
facts and then we take those facts to the public forum. But, I 
will say, as in any public forum, when you're making what I 
will call a political decision, the people who make those land 
use decisions, who are the local people, not the Federal 
Government, that's still going to be a factor. And I think it 
should be a factor based on fact, not on what I will call the 
psychology of the crowd and the audience at a given moment, 
because I think it will be fairer if we do it in fact. That's 
what we're trying to do here.
    Mrs. Cubin. And there is no question that I agree. I'm a 
chemist by training and I agree that sound science is 
predictable and it's absolutely what we need to base our 
decisions on, not just for the short term, but for the long 
term as well. It's the politicizing of issues that have caused 
problems for your state and for my state, as well.
    I guess I don't have any other questions. Mr. Underwood?
    Mr. Underwood. Just a brief question, because the 
discussion is very interesting, in the sense that we're trying 
to provide more scientific input into the process. But, at some 
point in time, you know, all the science in the world, even the 
information about oil spills being generated more by vessel 
traffic than by oil and gas exploration, doesn't make the 
difference, in terms of how people feel about it.
    And so, you know, as you've outlined--and I'm very 
sympathetic to that. Where I come from, we have mangrove swamps 
and we have coral reef and they're all very fragile 
environments and they're easily disturbed and they could be 
disturbed by silt from, you know, construction sites and a 
whole host of things. So, I'm very sympathetic to the idea of 
trying to protect those. And sometimes, in the case of oil and 
gas exploration, for an economy that's driven by tourism or an 
economy that's driven by the visitor industry, the prospect of 
having oil and gas exploration is something that, you know, 
maybe other states or other areas will make a decision based on 
what they think is in their best interest. But, I think 
clearly, in your case, you--both you and the gentleman from the 
state government there have made the case that--that it seems 
like your intent is to--is to forestall the possibility of 
having these leases.
    So, my question to you is just a brief one, for my 
edification, why is--why are the moratoria that are in place, 
why are they inadequate, in order to get the desired result?
    Mr. Goss. If you accept the desired results that I outlined 
in my comments, which is to reach a way to make a decision, 
rather than to keep temporizing and keep pushing this 
discussion down the road--because we are holding in abeyance 
right now by this moratorium--it is a moratorium--we're holding 
in abeyance both a final decision on private property rights, 
where there has been real dollar investment in excess of $100 
million, and there is an expectation of realizing something on 
that investment, properly so by the private property owners. On 
the other side of that issue is a very strong sentiment in the 
State of Florida, which votes for its elected officials on 
issues like this, that they will protect the economy, the 
quality life, and the shoreline. And there is a dispute over 
what is the best use of the land and where the most risk 
exists. And I suggest that the moratorium doesn't get us close 
to an answer. It just keeps pushing the answer down the road 
every year.
    The second part of that is perhaps some year, somebody will 
forget to do the moratorium, then the issue is open and 
exploitable; or for some year for some other reason that 
appropriations bill will get lost in the shuffle. And perish 
the thought we would ever have an appropriations bill not 
passed; it never would happen, would it? So, there are some 
dangers in the situation. Additionally, the only other real 
protection is these Executive Orders and Executive Orders come 
and go with presidents, so that's not much protection.
    And the real reason is there are varying degrees of risk in 
various parts of the Florida estuarine and water system and 
waterway system. There probably are some places in Florida that 
could accommodate some type of activity. I think that's an 
important part of the discussion. I think that, as I say, the 
land use decisions and so forth by the state laws and the 
Federal laws come to play in that. All of that should be 
weighed in this process.
    I'm not saying that the present protection isn't adequate, 
I think it is adequate; I'm just saying it's not the final 
solution. And I think that one of the responsibilities we have 
here, instead of parking a problem, is to try and resolve it.
    Mr. Underwood. Well, I would have to say that coming from 
the kind of jurisdiction that I come from, I certainly find 
very attractive the notion that you ought to build in more 
local input into the process of making a decision about what is 
normally thought of as Federal assets. But, certainly, it 
remains an open question, because your legislation is really 
provocative, in the sense that it's really offering a change in 
the way we make decisions about public lands and about not just 
OCS.
--------------
    ``We were talking about expiration for hydrocarbon fuel 
source today on the floor, the recent discussion about global 
climate change issues, and the C022 on the 
atmosphere. Does your department have any role or interest in 
that issue? Is your department interested in evaluating the 
fications of decisions like this on C02 and global 
climate changes? Is that in your portfolio at all?''
    There are a number of outstanding questions concerning 
emissions and global warming. For instance, is it real? What 
can be done about it if it is real? How urgent should our 
concern be? What will it cost? Will it affect U.S. industry 
disproportionately to less developed countries? How will our 
defensive position militarily be affected if we aggressively 
scale back our emissions from energy consumption? Will the 
effects be catastrophic? Is public health a concern? These 
questions, of course, lead to more.
    Most of these issues are best addressed at the national 
level. In Florida we are aware of the technical issues involved 
in trying to determine the rate of global warming if indeed it 
exists. We will stay up to date on findings as they occur 
regarding this hypothesis. National Energy policy will drive 
this issue to such a degree that individual states will 
probably be only small players in the resolution of the 
question. Florida is ready to do its part in solving the 
problem once it is defined and would do so aggressively if 
needed.1But in a sense, you know, we're reaching over into 
what--what the Chairlady had referred to earlier about all the 
other things that she so capably does at every hearing, brings 
in every issue related to Wyoming, no matter what the topic.

    [Laughter.]
    Mr. Underwood. And so, I've seen this at work a number of 
times. But, it really is a question of how we deal with what 
are thought of as national assets and how we build that process 
in. So, it's provocative in that sense. And for myself, I find 
it very engaging, because I think from where I come from, 
people don't have enough input into federal assets. Thank you.
    Mr. Goss. May I just add a further word to that. I agree 
with your premise that we have national assets and national 
matters here. We, also, have basically got local zoning, and 
it's that interplay. In this case, I will tell you we have all 
three levels of government, local, state, and federal 
government working together and we have all political parties, 
at least all known political parties in agreement on this. So, 
I will--as I stated in my answer to your----
    Mr. Underwood. Even wrestlers are in that?
    Mr. Goss. To the Chair, well, then, as I stated, I will not 
make a guarantee that the decision will be made on a factual 
basis. I'm saying, however, the conversation ought to start on 
a factual basis, rather than on the basis of putting your best 
foot forward as an interested party.
    Mrs. Cubin. Mr. John?
    Mr. John. I'll just be very brief. Mr. Goss, most of the 
area--the outlying waterways around the panhandle of Florida, 
in your state, are under some sort of moratorium today, from 
the Georgia-Florida line, all the way around the Keys, up to 
Alabama; is that correct?
    Mr. Goss. There are varying degrees of protection; but the 
answer is essentially, yes, there is some regulation.
    Mr. John. And I guess your consideration is on the eastern 
Gulf side, with some of the leases that are proposed within 
this five-year plan of MMS. Is that kind of where you're going 
with your bill or is it all encompassing all along the shore?
    Mr. Goss. It is to deal with all of the Florida waters and 
offshore waters off of the Florida waters. The degree of 
scientific data that we want is to reveal what I think we are 
going to find, is that there are vast differences between the 
waters off, say, Jacksonville, Florida, in the north Atlantic 
cut, and let's say for Jefferson, in the very sensitive lower 
estuarine Keys. I think there are obvious differences. What we 
want to do is not put a one size fits all regulation. What we 
want to do is be able to have a scientific basis for making 
decisions about proposals, because most of these proposals, as 
you know, come in to do oil and gas exploration in area 
specific, a place you can put with the GPS out there on a 
chart.
    So what we're trying to do is to figure out what the risk 
factors are in all these places, what the land based 
association and support system would be. And as you know in 
north Florida, we have one case where they're drilling in north 
Florida or they're proposing to drill, I'm not sure what the 
active status is, but they're actually planning to pipeline it 
into an adjacent state, in order to avoid the onshore 
facilities question. So the answer is, we want to do the whole 
thing of Florida, because the Florida delegation is together on 
this and we've cut out Florida because it's unique. But, we are 
no way saying that this is only a Florida question. There are 
other states that have that, too, and I've testified before 
this Subcommittee on that part before with others from other 
states. We put this bill in for Florida, because we feel that 
we have a solution here we want to try with this joint task 
force. And I represent southwest Florida, but all 23 members of 
the Florida delegation and both senators and the governor's 
office are four square behind what we're trying to do. This is 
not my bill, it's our bill.
    Mr. John. In the five-year program plan, does it mandate 
any kind of these type of studies? There's nothing out there 
ongoing now that would satisfy what you're trying to do?
    Mr. Goss. Well, I'll let Mr. Joyner respond to part of 
that; but as you've heard in his testimony, we haven't quite 
gotten there. There have been what I will call a series of 
different sort of think tank approaches to this. What we 
haven't done is given them, I guess, sort of a force of 
seriousness by bringing them all together and completing them 
and saying we all agree that this is pretty much the factual 
situation. What we have is somebody hiring somebody to go out 
and say, don't you think that the situation is about this, 
couldn't you find data to support that; somebody else with a 
different approach to it would say, don't you think we can go 
out and find data to do this. Now, I could find data to go all 
kinds of different ways. What I would really like to do is to 
get one basic credible setup joint group to give us data that 
they all agree is good data and then we'll play with the data 
when we get there, then we'll go to our zoning boards and have 
our town meetings. But, it's getting that base data is what 
we're trying to and provide protection while we're doing it.
    Mr. John. Okay.
    Mrs. Cubin. Mr. Inslee?
    Mr. Inslee. I'm going to pass, Madame Chair.
    Mrs. Cubin. I found my other question for you, Porter, and 
then I do have some for Mr. Joyner, and, actually, this is a 
two-part statement, question, whatever. The National Research 
Council does seem to have recommended that socioeconomic 
studies be conducted, and you addressed that in your testimony, 
as well. I want to make two points about that. Number one, is 
we have been trying to get socioeconomic input in environmental 
impact statements and environmental assessment studies, when we 
are trying to permit, for example, large gas field in Wyoming, 
and those issues have not been allowed to be entered into the 
environmental impact statement and the environmental assessment 
statements. And so, I was--if it's right for Florida, it ought 
to be right for everyone else. And so, I hope that we can work 
together to impress upon our colleagues that the socioeconomic 
impact of decisions that are made truly is something that 
should be considered when these decisions are made.
    Mr. Goss. I would be the first to testify that I think 
homosapiens is a legitimate part of the environment and I 
think, generally speaking, that ought to be considered. It may 
not be entirely relevant in every situation, I don't know.
    Mrs. Cubin. Exactly.
    Mr. Goss. But, I would certainly say it ought to be on the 
checklist.
    Mrs. Cubin. Then the other aspect of that, the socio-
economic study I wanted to bring up was I would like to be sure 
that included in that study is a balancing of Florida's future 
energy needs. I understand there's going to--I mean, everyone 
would agree that the energy needs for Florida is going to 
increase through the following years, and so the supply of 
energy versus the demand. And then, I, also, would like to--the 
study to include the socioeconomic impact of the likelihood of 
oil spills from vessels, as opposed to platforms and pipelines, 
that--that those should be factors, I think, in that study. 
Would you agree with that?
    Mr. Goss. I would absolutely agree. I think we want the 
total risk. I am looking at all aspects of this. Part of this 
discussion that we've gone into many times is if you do shore 
side facilities, what does that do to air quality, for 
instance. It's a fair question, if you're going to do shore 
side facilities; if you're not, not a very relevant question.
    Perhaps the best answer I can give you to the question is, 
I think that the State of Louisiana has shown me conclusively 
that there is a way to extract oil and gas viably and also 
benefit the environment, at the same time. And I would take you 
to the rainy preserve in southern Louisiana, where they produce 
oil and gas and they, also, have a bird sanctuary. It is 
probably the single lesson that says, you don't have to have 
losers; everybody can win if you do this right.
    Mrs. Cubin. That's right; I think that's right.
    Mr. Joyner, my staff recently read that there's a large 
desalinization plant that has been proposed for the Tampa Bay 
region for fresh water needs that the state will have. Do you 
have any idea what kind of electricity demand there will be for 
that plant?
    Mr. Joyner. It's my understanding--and I've got to admit, 
Congressman, I have been with the department for about six 
months now, so, quite honestly, I'm still learning where things 
are. But, yes, we do have an Office of Air that I think 
certainly would be very interested in that. What I'd like to be 
able to do is just go back--Howard Rhodes is the gentleman, 
very good reputation, in Florida that handles those issues. I'd 
like to go back to him and just express your comments.
    Mr. Inslee. Well, I appreciate that and I'll give you a 
card and you let me know what you're doing.
    Mr. Joyner. Please do.
    Mr. Inslee. Thanks a lot.
    Mr. Joyner. Thanks.
    Mrs. Cubin. The Chair thanks both of you for being here and 
for your wonderful testimony. And then if we have some written 
questions, I hope that we'll be able to get answers from you on 
those. So, thank you, very much.
    Mr. Goss. Thank you, Madame Chair, very much. We are indeed 
grateful for the opportunity.
    Mrs. Cubin. Thank you.
    At this time, we'll call the second panel forward: Mr. Walt 
Rosenbusch, Director of the Minerals Management Service; Mr. 
Jay Hakes, Administrator of the Energy Information 
Administration.
    Mr. Rosenbusch, would you like to begin?

STATEMENTS OF WALT ROSENBUSCH, DIRECTOR OF MINERALS MANAGEMENT 
     SERVICE, U.S. DEPARTMENT OF THE INTERIOR; JAY HAKES, 
    ADMINISTRATOR, ENERGY INFORMATION ADMINISTRATION, U.S. 
                      DEPARTMENT OF ENERGY

    Mr. Rosenbusch. Thank you, Madame Chairman and members of 
the Subcommittee. It's a pleasure to be here today to testify 
on H.R. 33. This is my first time to testify before the 
Subcommittee and just recently been appointed Director of The 
Minerals Management Service. However, I do know from past 
experience with the Department of Interior and the Assistant 
Secretary's office, that the Subcommittee takes a very active 
interest in the activities of the Minerals Management Service. 
And accordingly, I look forward to working closely with members 
of the Committee.
    Prior to discussing the department's view on H.R. 33, I'd 
like to take just a moment to highlight some of the important 
facts concerning the OCS program. From an energy standpoint, 
the OCS produces about 22 percent and 27 percent, respectively, 
of our nation's domestic oil and natural gas. And by 2001, oil 
and gas production on a daily basis is expected to increase 
from 3.3 million barrels of oil equivalent in 1995 to as much 
as 4.9 million barrels of oil equivalent, on a per-day basis. 
From an economic standpoint, MMS collects on average over four 
billion dollars per year in mineral revenues and over three 
billion of that total comes from the OCS. These monies go to 
the Federal treasury to help pay for Federal programs, but a 
significant majority of these revenues are shared with various 
onshore and coastal states. Finally, a portion of OCS revenues, 
as already been mentioned, goes to the Land and Water 
Conservation Fund, a program that benefits all Americans. 
Historically, OCS revenues have provided over 90 percent of the 
funding to the LWCF.
    When this administration assumed management of the OCS 
program in 1993, I think it's fair to say that it had 
substantial problems facing it. There were congressional 
moratoria on leasing and development activities, ongoing breach 
of contract litigation by lessees with certain leases, and 
unresolved issues associated with existing leases in various 
areas that demanded our attention. However, six years later, 
many of those controversies have been resolved or substantial 
progress has been made towards resolving them. I believe the 
main reason the department has been able to move the OCS 
program forward is because we recognized early on that conflict 
resolution would have to be a high priority and that the best 
way to proceed would be to listen very carefully to our 
stakeholders.
    Our conflict resolution efforts were primarily made up of 
two components. The first was to endorse the existing annual 
congressional moratoria that were in effect. We did this in 
order to assure our stakeholders that the status quo would be 
maintained while discussions ensued on the direction of the OCS 
program.
    The second major component of our conflict resolution 
effort was the development of the OCS five-year program for the 
year 1997 to 2002. That program was guided by three principles: 
one, consensus-based decision-making; two, science-based 
decision-making; and three, focusing on the use of natural 
gases and environmentally preferred fuel. That program was 
developed with significant stakeholder participation and 
collaboration, and for the first time since annual moratoria 
were enacted, we now have an OCS five-year program that does 
not propose to lease in areas where opposition and controversy 
led to those restrictions. In addition, in June, 1998, the 
President issued a directive that certain OCS area be withdrawn 
from future leasing consideration until at least the year 2012. 
These areas had been under annual leasing moratoria and are not 
part of the department's current five-year program.
    From this short history, I believe you can see that we are 
serious about working with and listening to our stakeholders 
and basing our decisions on good science, and I believe our 
track record over the past six years has borne out this fact.
    With regards to our views on H.R. 33, the department has 
carefully reviewed the proposed bill, and while we appreciate 
the intent of the legislation to protect Florida's coast, we 
have concerns regarding the moratoria provisions and 
environmental research requirements of the bill. Some of the 
provisions would at best be duplicative. Moreover, there are 
other provisions of the bill that could be detrimental to the 
program. Instead of the approach advocated by H.R. 33, we 
believe that the current laws, processes, and programs already 
in place to address the OCS leasing and development related 
issues are working and should be continued. The OCS decision-
making process is one that is comprehensive and well thought 
out. At each step of that process, there are substantial and 
meaningful ways for stakeholders to have their concerns 
addressed.
    I'd like to conclude my remarks by saying that in 
retrospect, I believe that the past six years have taught us 
valuable lessons with respect to the OCS program. The most 
notable lesson is that it is absolutely critical for the 
program to be based on consensus, the willingness to listen to 
our constituents, and to working in a collaborative fashion to 
resolve issues; otherwise, we are bound to repeat the mistakes 
of the past. I believe the program we now have in place takes 
those lessons to heart. Furthermore, we remain committed to 
building on those efforts and to involving our stakeholders at 
every step of the process.
    Madame Chairman, this concludes my oral remarks. I would be 
happy to answer any questions.
    [The prepared statement of Mr. Rosenbusch follows:]

   Statement of Hon. Walt Rosenbusch, Director, Minerals Management 
           Service, United States Department of the Interior

    Madam Chairman, and Members of the Subcommitee, I 
appreciate the opportunity to testify on H.R. 33--a bill to 
impose restrictions and requirements on the leasing and 
development of certain Outer Continental Shelf (OCS) lands 
offshore Florida. However, before addressing the specifics of 
H.R. 33, I would like to begin by highlighting some important 
facts concerning the OCS program.
    First, the OCS program is a major source of energy for the 
Nation, currently providing about 22 percent of our total 
domestic production of oil and 27 percent of our production of 
natural gas. Hand in hand with this much needed energy 
production, the program generates substantial national and 
regional economic benefits. Those benefits come in the form of 
bonus, rent, and royalty payments to the Federal Treasury 
(almost $6 billion in 1998 and over $125 billion (to date)--a 
portion of which is distributed to coastal States under section 
8(g) of the OCS Lands Act--as well as income, local jobs, and 
taxes generated by petroleum companies and a host of 
manufacturers and other firms located throughout the country.
    Furthermore, OCS revenues are the major funding source for 
both the Land and Water Conservation Fund (LWCF) and, as of 
last year, the Historic Preservation Fund (HPF)--programs that 
benefit all Americans. To date, over $19.7 billion and $3 
billion have gone into the LWCF and HPF, respectively. The OCS 
program has an excellent safety and environmental record, and 
it produces a large quantity of natural gas, which is the most 
environmentally preferred form of fossil fuel.
    These benefits notwithstanding, the OCS program has been 
the subject of conflict, controversy, and--ultimately--
moratoria that have been in effect for many years for certain 
areas of the nation's coast. The history of moratoria is well 
documented in two reports produced by the Minerals Management 
Advisory Board-Moving Beyond Conflict to Consensus (April 1993) 
and Environmental Studies in OCS Areas Under Moratoria: 
Findings and Recommendations (May 1997). These reports were 
previously provided to the Committee. The former had a 
significant influence on the Department's development of its 
management approach, and the latter we use in managing our OCS 
Environmental Studies program.

THE DEPARTMENT'S APPROACH TO MANAGING THE OCS PROGRAM

    When this Administration assumed management of the OCS 
program in 1993, congressional moratoria were in effect for 
both the Atlantic and Pacific coasts, the Eastern Gulf of 
Mexico, and the North Aleutian Basin off Alaska. There were 
lease sales scheduled in the Atlantic and Eastern Gulf of 
Mexico areas under leasing moratoria; there were drilling 
restrictions on previously issued leases in the southeastern 
part of the Eastern Gulf of Mexico, in the North Aleutian 
Basin, and off North Carolina; and there was breach-of-
contract/takings litigation that had been filed by the 
companies holding those leases. There also were existing leases 
in the areas subject to leasing moratoria off the Florida 
Panhandle and off California that demanded our attention; and 
there were proposed lease sales off Alaska that were generating 
controversy.
    The Department believed that while the OCS program held 
great potential, it had become mired in controversies because 
it had been insufficiently attentive to the public's desires. 
Therefore, the Department embarked on a strategy designed to 
decrease the controversy so that conflicts and concerns could 
be addressed in a more rational atmosphere. This approach 
placed a high priority on conflict resolution and consulting 
with--and listening very carefully to--the OCS program's 
various stakeholders.

Endorsing Annual Congressional Moratoria

    The first approach we used was to endorse the existing 
annual congressional moratoria as a way to assure the 
stakeholders that the status quo would be maintained while 
discussions ensued. We felt that it was extremely important to 
ensure that no new leasing occur in areas where we were 
attempting to resolve intense disputes concerning already 
existing leases. In retrospect, the annual moratoria that were 
in effect proved to be a very useful tool that enabled us to:

         settle litigation concerning the leases in the North 
        Aleutian Basin and in the southeastern part of the Eastern Gulf 
        of Mexico, which resulted in their relinquishment;
         settle litigation on the leases off North Carolina, 
        which resulted in the relinquishment of 32 leases while 
        preserving the Manteo Unit for possible exploration;
         cancel proposed lease sales in the Atlantic and in the 
        Eastern Gulf off Florida that were precluded by the moratoria, 
        thereby allowing us and the stakeholders to concentrate on 
        resolving issues related to potential exploration and 
        development of remaining leases; and
         focus our efforts off California on the possible 
        development of existing leases without the distractions that 
        proposals for new leasing would engender.
    In short, the annual moratoria provisions and the actions we were 
able to take helped us begin building trust with our constituents and 
stakeholders and make strides in putting the OCS program on firmer 
footing in those controversial areas.
    At the same time, we took under careful consideration the sales off 
Alaska that had been proposed in the OCS 5-Year Program for 1992-1997 
that had been approved by the previous Administration. After consulting 
with stakeholders, we decided to:
         cancel sales in the Chukchi Sea, Hope Basin, Gulf of 
        Alaska, and St. George Basin Planning Areas based on low 
        industry interest and some concerns for other resources that 
        were expressed by native groups and others; and

         proceed carefully and deliberately in the presale 
        processes for Beaufort Sea Sale 144 and Cook Inlet Sale 149, 
        which resulted in successfully conducting those two sales after 
        a 5-year hiatus in Alaska OCS leasing.
    Our decisions resulting in the cancellation of three proposed 
Alaska sales--as well as cancellation of Atlantic and Eastern Gulf of 
Mexico sales--were made with the view that this Administration would 
have the opportunity to formulate its own 5-year program (covering the 
1997-2002 timeframe). In developing that program, we would consult 
further with stakeholders to reach consensus on any future sale 
proposals for those areas and others.

Developing an OCS 5-Year Program by Consensus

    The second approach we used to address past controversies with the 
OCS program was to develop an OCS 5-Year Program for 1997-2002 that was 
based not only on the substantive and procedural requirements of 
section 18 of the OCS Lands Act, but also on three general guiding 
principles endorsed by the President and the Secretary-consensus-based 
decisionmaking, science-based decisionmaking, and the use of natural 
gas as an environmentally preferred fuel. We consulted with and 
listened to stakeholders from start to finish in the 2-year preparation 
process.
    As a result, the current OCS 5-Year Program is one that was 
developed by consensus and through the active participation of our 
various stakeholders. As such, it has allowed us to focus our energies 
on constructively discussing and resolving specific issues related to 
areas to be leased, as opposed to debating which areas are appropriate 
to even consider for lease.

The President's June 1998 OCS Directive

    The third approach the Administration used to address stakeholder 
concerns regarding OCS leasing and development was to administratively 
withdraw certain OCS areas from further leasing consideration for a 
period of time. Specifically, in June 1998, the President issued a 
directive to the Secretary of the Interior to withdraw from leasing 
consideration until at least 2012 OCS areas located offshore the east 
and west coasts of the United States, the majority of the Eastern Gulf 
of Mexico, and the North Aleutian Basin offshore Alaska. In general, 
the areas adminstratively withdrawn were the same areas that had been 
under annual congressional moratoria for many years and where 
controversies or concerns still remained. Further, the President's 
directive also permanently prohibited future OCS leasing activity in 
marine sanctuaries.
    As a result of the actions I have just discussed, the OCS program 
now reflects stakeholder desires with respect to the role the program 
should play in meeting the Nation's energy needs. Furthermore, it is 
important to note that the current OCS 5-Year Program, the President's 
June 1998 OCS directive, and annual congressional moratoria are in 
harmony; i.e., all areas prohibited from leasing consideration in the 
Department's annual appropriations legislation are excluded from 
leasing consideration in the Department's 5-Year Program and are 
administratively withdrawn from future consideration until 2012. Of 
note, the Department requested, and the Administration included in the 
President's FY 2000 Budget, the areas under leasing moratoria in the 
Fiscal Year 1999 Omnibus Appropriations Act (Public Law 105-277) be 
continued in Fiscal Year 2000.

PROVISIONS OF H.R. 33

    With respect to OCS leasing, exploration, and development 
activities offshore the State of Florida, H.R. 33 proposes to----

         prohibit leasing and preleasing activities offshore 
        Florida at least until after the expiration of the period 
        covered by the next OCS 5-Year Program (ie; until 2012), and 
        permanently prohibit leasing activities in areas in the Eastern 
        Gulf south of 26 degrees N. Latitude and east of 86 degrees W. 
        Longitude;
         extend the prelease and leasing prohibition even 
        further until (1) all environmental research, assessment and 
        studies called for in the bill are completed and peer-reviewed; 
        and (2) the Secretary prepares a report certifying that he has 
        adequate information to carry out his duties under the OCS 
        Lands Act with a ``minimal level of uncertainty;''
         permanently prohibit the approval of any exploration 
        or production activities in the Eastern Gulf south of 26 
        degrees N. Latitude and east of 86 degrees W. Longitude, and 
        for other areas offshore Florida--to prohibit the approval of 
        any permit or exploration or production activity until (1) all 
        environmental research, assessments and studies called for in 
        the bill are completed and peer-reviewed; and (2) the Secretary 
        prepares a report certifying that he has adequate information 
        to carry out his duties under the OCS Lands Act with a 
        ``minimal level of uncertainty;'' and establish a joint 
        Federal-State Task Force to supervise the peer-review of all 
        research and to review the report prepared by the Secretary 
        certifying that he has adequate information available to carry 
        out his duties under the OCSLA.
    These provisions would apply to three OCS planning areas--that part 
of the South Atlantic Planning Area located offshore Florida; the 
Straits of Florida Planning Area; and that part of the Eastern Gulf 
Planning Area located offshore Florida. However, there is no OCS 
leasing proposed in the 1997-2002 OCS 5-Year Program for either of the 
first two areas, and likewise, there are no existing OCS leases in 
these areas. Therefore, the only area affected by the legislation would 
be the Eastern Gulf of Mexico Planning Area. There is a small area 
located 15 miles offshore Alabama and more than 100 miles offshore 
Florida that is proposed for possible lease in late 2001, and there are 
approximately 110 existing leases located in that part of the Eastern 
Gulf affected by the provisions of the bill.

VIEWS ON H.R. 33

    We have carefully reviewed the provisions of H.R. 33 in light of 
current law, the President's OCS directive, and the Department's 
efforts to address past controversies with the OCS program. We 
appreciate the intent of the bill--to protect Florida's coast--but we 
have concerns regarding the effect that the moratoria provisions and 
the environmental research requirements will have on the OCS program.

Proposed Leasing Moratorium in H.R. 33

    With regard to the leasing restrictions proposed in the bill, we 
would again note that the current OCS 5-year Oil and Gas Leasing 
Program for 1997-2002 is a consensus-based program which proposes only 
a limited area for potential lease in 2001 in the Eastern Gulf of 
Mexico and no leasing in other OCS areas offshore Florida. In the 
Eastern Gulf of Mexico, the area for possible lease is located 
primarily offshore Alabama and more than 100 miles off the coast of 
Florida. During development of the current OCS 5-Year Program, both the 
States of Florida and Alabama agreed to allow this area to be 
considered for possible lease.
    Furthermore, the President's June 1998 OCS directive prohibits the 
Department until at least 2012 from considering leasing areas offshore 
Florida that are located outside the limited area in the Eastern Gulf 
of Mexico previously agreed to by the States of Florida and Alabama.
    Even if an area offshore Florida were to be considered for possible 
leasing after 2012, it is important to note that there is a 
comprehensive set of laws in place to guide that decisionmaking 
process. I have attached a chart to my testimony that outlines that 
process from the development of an OCS 5-Year Program all the way 
through the review and approval process for an OCS Development and 
Production Plan. From this chart, it is readily apparent that at each 
point of the OCS process, decisions would be subjected to a detailed 
planning and consultation process as outlined in the OCS Lands Act as 
well as requirements under the National Environmental Policy Act and 
numerous other environmental statutes. Also, in the case of proposed 
lease sales, exploration plans, and development plans, preparation of a 
section 307 consistency determination under the Coastal Zone Management 
Act would also be required. Therefore, there are many points in the 
current OCS leasing process that would ensure that State concerns are 
substantively addressed prior to any final decisions regarding an 
activity.
    Finally, and as I previously mentioned, through the annual 
appropriations process as well as the President's OCS directive, the 
Department has endorsed a leasing prohibition offshore Florida for 
areas lying outside mutually acceptable areas contained in the OCS 5-
Year Program for 1997-2002 in order to work cooperatively with the 
State to resolve issues of concern and obviate the need for long-term 
moratoria. H.R. 33 could be counterproductive to continued dialogue 
with affected constituencies and may diminish the motivation to 
continue the difficult process of building trust with all affected 
parties.

Proposed Drilling Moratorium in H.R. 33

    H.R. 33 also contains language that would impose a drilling 
moratorium offshore Florida for a period of time that is tied to the 
completion of certain research, assessments and studies. The Department 
has concerns with this provision. First, it could undermine the 
statutory and regulatory processes in place to consider proposals for 
industry operations on leases with already-approved exploration or 
production plans. Second, it could undermine the ongoing consultation 
and dialogue necessary with the State of Florida and local governments 
to determine the most appropriate ways to explore for or develop 
existing OCS leases.
    Most importantly, imposition of a drilling moratorium would have an 
immediate impact on the approximately 110 existing leases located in 
the Eastern Gulf offshore Florida. In turn, the drilling moratorium 
could have severe economic implications on lessees and operators and 
could very likely set the stage for litigation for a potential buyback 
of those leases. Although none of these leases are yet producing, many 
have been explored, several have ``producible'' wells, and in at least 
one instance, the lessees are pursuing efforts to develop a significant 
natural gas find on their leases. The value of these existing leases 
would be significant, and the potential liability to the American 
taxpayer could be sustantial.
    In Conoco v. United States, decided in 1996, language similar to 
that contained in H.R. 33 was addressed by the United States Court of 
Federal Claims. The Court found that the Federal Government was liable 
for breach of contract and the plaintiffs were entitled to damages.
    Although the case was subsequently reversed on other grounds, it is 
true that similar language spawned expensive and time-consuming 
litigation for both sides. Therefore, if H.R. 33 is enacted with these 
restrictions on the process of approving and permitting exploration and 
other drilling activities, it could set the stage for extensive 
litigation and possible buyback.

Proposed Environmental Research Requirements of H.R. 33

    MMS has concerns with the section 4 environmental research 
requirements since they do not take into account the comprehensive and 
open process MMS uses to determine what environmental research is 
necessary for a given OCS area. Further, the bill fails to give 
adequate recognition to the extensive suite of environmental studies 
MMS has developed with regard to areas offshore Florida--particularly 
in the Eastern Gulf of Mexico. In addition, section 4 does not take 
into account the extensive peer review process that is already in place 
to ensure the integrity of OCS environmental research.
    Finally, although section 4 references the need to conduct studies 
as recommended by the National Research Council (NRC), it does not take 
into account the recommendations coming out its review of the MMS 
Environmental Studies Program. The NRC provided final guidance in its 
report to MMS--Asessment of the U.S. Outer Continental Shelf 
Environmental Studies Program: IV Lessons and Opportunities, NRC, 
1993--and MMS has relied heavily on its recommendations and guidance as 
it considers environmental studies needs for the Eastern Gulf of 
Mexico.
    Listed below is a status of of our environmental research in the 
Eastern Gulf of Mexico and an overview of NRC guidance vis-a-vis 
various provisions of the bill.

(1.) Studies required in H.R. 33.

    Section 4 outlines certain specific studies that should be 
conducted by MMS and also requires an unlimited number of additional, 
unspecified studies that may be requested by the Governor of Florida or 
the Joint Task Force (as proposed in section 5 of the bill).
    In fact, the socioeconomic study called for in section 4(l)(A) 
should be completed in late 1999 and is entitled ``Socioeconomic 
Baseline and Projections for Selected Florida Panhandle Communities.'' 
The ecosystem study called for in section 4(l)(B) is scheduled to be 
under-taken in Fiscal Year 2001. In conjunction with that study, MMS 
plans to hold a workshop this October in Florida to delineate the scope 
of the study. Finally, the physical oceanography studies called for in 
section 4(l)(C) are currently underway and scheduled for completion in 
the near future.
    With regard to the NRC studies called for in section 4(l)(D), it 
should be noted that the NRC report referenced in the bill discussed 
the adequacy of information with respect to the southwestern Florida 
area and indicated that the physical oceanographic information was 
marginal for that area. However, no existing leases remain in this area 
and, this is part of the Eastern Gulf that is both under annual 
congressional moratoria and the President's June 1998 OCS directive 
regarding new leasing.
    However, MMS has added a considerable amount of information to our 
knowledge of ocean circulation in the Eastern Gulf, a matter of concern 
expressed in the NRC report. We are nearing completion of several 
projects employing anchored instruments, satellite images, surface 
drifting Buoys, and computer models to look at how ocean currents move 
in this area. In particular, we are studying the interaction, if any, 
between the nearshore currents and eddies from the head of DeSoto 
Canyon. Although, to date, there have been only natural gas discoveries 
in the area, this knowledge will help us better understand what might 
happen if an oil spill did occur. These efforts will be reviewed at the 
October workshop to determine what additional research should be 
considered. Additionally, new meteorological information will also help 
us see if there may be any potential effects from the emissions of OCS 
activities.
    We have also improved our understanding of the biological and 
coastal resources in the eastern Gulf. A recently completed field study 
of whales in this area is providing new information on where these 
animals can be found. In a cooperative effort, MMS and the State of 
Florida have just finished updating information on a wide variety of 
coastal resources for storage on a geographic information system to aid 
the State and Federal government in assessing potential impacts to 
these resources.
    Our understanding of the human environment in this area has also 
improved. Baseline information regarding the socioeconomic conditions 
of selected Florida panhandle communities has recently been completed 
and is being examined to project how these conditions may change in the 
future. Several new studies that have either just started or are 
planned to start in the near future should also give us a better 
understanding of the Florida socioeconomic environment.
    In summary, through these studies MMS has addressed the issues 
raised by the NRC report and has continued to identify new issues 
through outreach programs and issue specific workshops to ensure that 
decisions are based on the best available information.

(2.) Peer review of studies.

    H.R. 33 proposes to require all research required by the bill to be 
peer reviewed by qualified scientists who are not employed by the 
Federal Government. MMS already has an available peer review mechanism 
recognized by the NRC. In Report IV, the NRC strongly emphasized that 
MMS should use the OCS Advisory Board Scientific Committee for advice 
on environmental research. Scientific Committee members are 
independent, nationally-recognized experts in the marine and social 
sciences, appointed by the Secretary of the Interior, and not employed 
by the Federal Government. Most members have served on NRC committees 
and other special ``peer review'' panels, and are very frank in giving 
MMS advice in open, public meetings. Furthermore, the Scientific 
Committee provides peer review on MMS research.
    Therefore, the additional layer of peer review provided for in the 
bill is not necessary to ensure quality science and, indeed, provides 
no method to resolve conflicts that could occur from these two separate 
reviews.

(3.) ``Minimizing Uncertainty'' Through Studies.

    H.R. 33 would require the Secretary to certify that he has adequate 
information available to carry out his duties under the OCS Lands Act 
with a ``minimal level of uncertainty'' before approving leasing or 
exploration/development activities. This requirement implies that the 
only way to minimize uncertainty is by conducting additional research 
and that all studies mentioned by the NRC must be completed. However, 
in Report IV, the NRC stated that----

        ``it cannot--and should not--prescribe a detailed plan of 
        studies for the Environmental Studies Program. Because the 
        state of knowledge, budget constraints, and other factors 
        change continuously, this Committee can provide only broad 
        guidance on priorities based on its assessment of current 
        conditions.''
    The MMS has followed the guidance from the NRC and is under the 
oversight from its Scientific Committee in setting its research agenda, 
as recommended by the NRC.
    Further, the bill proposes that the Secretary be prohibited from 
conducting any leasing or development activities until all assessments 
specified in the bill are completed, peer reviewed, and approved. This 
requirement could be interpreted to mean that all information, 
including that needed for exploration and development activities, must 
be completed and approved prior to even considering a leasing action. 
This requirement would run counter to both recommendations by the NRC 
and the environmental assessment process envisioned in NEPA.
    The OCS program and NEPA both recognize that levels of 
environmental information necessary to make the first decision (i.e.; 
holding a lease sale) are not the same as those necessary to make a 
decision on the placement of a platform. It would be literally 
impossible to have all the information necessary to make decisions with 
``a minimal level of uncertainty'' on the approval of an exploration or 
development plan prior to the decision to hold a lease sale. Such 
information is best gathered and assessed once the location and 
specific circumstances of the proposed exploration or development 
activity are known.
    Finally, H.R. 33 also permits the Governor of Florida or the Task 
Force to require ``any'' additional information to ``minimize 
uncertainty.'' This provision would essentially give the Governor and 
the Task Force a blank check to require any kind of study, or endless 
numbers of studies, regardless of the applicability of that study to 
OCS decisionmaking. In Report IV, the NRC stated--``The process of 
deciding how much science is enough should be a process whereby 
scientific knowledge provides to decision makers an assessment of 
potential impacts and risks--including the range of uncertainty-
associated with an action. The response to scientific uncertainty need 
not always be the commissioning of additional studies. Any decision 
whether or not to conduct further studies should have a rational basis 
that can be documented.''
    The NEPA process provides the best approach to defining what the 
real issues are with regard to a project and uses the ``scientific 
knowledge'' method highlighted by the NRC to provide to decisionmakers 
and the public an assessment of potential impacts and risks, including 
uncertainty. For example, many of the deliberations by the NRC centered 
on oil. But to date, only natural gas has been discovered in commercial 
quantities in the Florida Panhandle area, and gas is expected to 
comprise a significant portion of the hydrocarbon resources found in 
that area. The development of natural gas can have quite different 
impacts than oil. One would not need to know everything possible about 
the effects of oil spills to develop gas fields. For development of a 
gas field, the NEPA analysis would key on issues associated with 
impacts from gas development.

CONCLUSION

    In summary, while we appreciate the intent of the legislation, we 
believe that the current consultative and environmental processes 
already in place--along with the Administration's willingness to listen 
carefully to its stakeholders and make decisions based on good 
science--are the best way to proceed with the OCS program. As 
experience has shown us, consideration of OCS areas to lease and 
develop should be based firmly on science and consensus, or we are 
bound to repeat the mistakes of the past. We believe we have made 
significant strides in building public consensus concerning the OCS 
program in +the past several years. Further, our Environmental Studies 
program supports the NRC's recommendations regarding scientific 
studies. These efforts should be allowed to continue.
    Madam Chairman, this concludes my prepared remarks. However, I will 
be pleased to answer any questions Members of the Subcommittee may 
have.
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[GRAPHIC] [TIFF OMITTED] T1320.024

    Mrs. Cubin. Thank you for your testimony. The Chair now recognizes 
Mr. Hakes.

      STATEMENT OF JAY HAKES, DIRECTOR OF LEGISLATIVE AND 
   GOVERNMENTAL AFFAIRS, FLORIDA DEPARTMENT OF ENVIRONMENTAL 
                           PROTECTION

    Mr. Hakes. Thank you, Madame Chair, and thank you, members 
of the Committee for this opportunity to discuss the pattern of 
energy consumption in the State of Florida. I would point out 
that almost all of this information is available on the 
Internet, so the Committee and, in fact, the general public all 
over the country has easy access to it.
    For today's hearing, I believe I can be very brief. Rather 
than repeat what's available elsewhere, I would just like to 
highlight a few major aspects of Florida's energy use. Florida 
has grown rapidly to become the fourth most populous state in 
the country, but it's profile of energy use differs in several 
respects from the profile of the nation as a whole. Relative to 
other states, Florida does not have a lot of heavy 
manufacturing industries, which decreases its total need for 
energy. On the other hand, Florida has long driving distances 
and a large tourism industry, adding to the demand for 
petroleum-based transportation fuels. And if we look at the 
first chart that I brought with me, and it's also Chart 1 in 
the written testimony, which I believe you have, you can see 
that the red bar there, which reflects petroleum use, is by far 
the biggest source of energy in Florida and more so on a 
percentage basis than it is elsewhere.
    The state uses relatively little natural gas or oil for 
space heating, because of its mild winters, and it does have 
heavy demand for air conditioning; therefore, these factors 
increase the need for electricity, which is quite great in the 
state. And if we look at the electricity generation chart, we 
can see, again, that relative to the rest of the country, 
petroleum plays a fairly big role. Petroleum, there again the 
red bar, is 16 percent of electricity production in Florida. 
Now, that's not the largest amount of electricity; but in the 
rest of the nation, it averages about 2 or 3 percent of 
electricity. Since the early 1970s, when we had a lot of 
electricity coming from petroleum, today we have very little, 
except for some places like Florida.
    Florida's topography is very flat, as was mentioned by the 
initial witness, which makes the potential for hydropower very 
limited. And finally, Florida's population is likely to 
continue to grow more rapidly than the nation as a whole. This 
leads to the expectation that its energy consumption will also 
rise faster than elsewhere. The amount of electricity used in 
Florida, for example, is estimated by the Energy Information 
Administration to increase about 2.2 percent a year, from 1997 
to 2005.
    These comments, I believe, cover the most salient points, 
and I'd be glad, at the appropriate time, to answer any 
questions from the Committee.
    [The prepared statement of Mr. Hakes follows:]
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    Mrs. Cubin. Thank you, very much. I will start the 
questioning with you, Mr. Hakes, I guess. Obviously, Florida's 
consumption of energy will be increasing, as your testimony 
said. So, how bad will it get from the energy deficiency 
standpoint for Florida in the next decade or so, and factoring 
in that desalinization plant at Tampa Bay, if that has been 
done?
    Mr. Hakes. Well, we have relatively few states in the 
country that are major energy producers. You have Louisiana, 
Texas, and Colorado. The West produces a lot of gas and oil. 
But, I don't have a calculation of--any energy produced in 
Florida, unless you consider nuclear production. There is some 
limited gas and oil onshore. But, basically, its energy use 
will continue to grow and, under current plans, the production 
probably would not grow at all. It's not unique in that 
respect. There are a number of states that are big consumers of 
energy that don't produce much energy.
    Mrs. Cubin. Yeah, that's absolutely true, but a lot of the 
other states that don't produce a lot of energy don't have--go 
off the shore 12 or 35 miles, where you can't even--wouldn't 
even be able to see platform from land and have the potential 
to produce that oil or gas in a safer fashion, I guess, than 
having vessels bring oil in. So, that's the only thing I'm 
trying to--trying to balance out somehow the needs and the 
responsibilities.
    Mr. Rosenbusch, welcome. This is your first opportunity to 
testify in front of the Committee and you did an excellent job 
and I----
    Mr. Rosenbusch. I'll be sure to tell my mom, thank you.
    Mrs. Cubin. Well, I have to say that you were just the 
model of decorum. We appreciate the intent of the bill to 
protect Florida's state, but we have concerns. I mean, I can't 
wait to hear you say this bill stinks or----
    [Laughter.]
    Mrs. Cubin. But can you further respond to Mr. Joyner's 
testimony about the adequacy of environmental studies that need 
to be done in the eastern Gulf planning area?
    Mr. Rosenbusch. Yes, Madame Chairman, I'd be glad to. Just 
to start off, to give us a backdrop to this, about $76 million 
worth of envirnomental studies has either been completed or is 
in the progress in the process of being completed right now 
relative to Florida. The National Academy of Sciences and the 
National Resource Council did make recommendations, in terms of 
the necessity to perform additional studies, but I would also 
suggest and state that they, said that those studies should be 
related to specific--specific activities, as we move forward. 
In other words, not all studies need to be completed up front 
before you make any decision; Instead, the process that we have 
in place right now accommodates the fact that there's going to 
be science that's needed and that science will be determined 
based upon what activity or action is being proposed, as 
opposed to trying to do it all at at one time.
    Mrs. Cubin. Just for my own edification, in addition to the 
money spent on the studies already, how much sunk investment 
costs are at stake in the eastern Gulf? I think that your 
testimony referred to $90 million in bonus bids. But wouldn't a 
buy out be substantially more expensive than that?
    Mr. Rosenbusch. Yes, Madame Chairman, there would probably 
be some other costs associated with that those leases. The $94 
million is strictly just the----
    Mrs. Cubin. Just the bonus?
    Mr. Rosenbusch.[continuing] just the bonus. I would imagine 
that a lessee would make a claim for other investments that may 
have been made on that lease.
    Mrs. Cubin. I think a key phrase in H.R. 33 is the term 
``minimizing uncertainty.`` And as with many policy issues, a 
point I want to make, what is the point of diminishing returns, 
with respect to OCS leasing? Wouldn't the decision to allow 
natural gas produced in the Gulf to be used for electric 
generation, rather than barges and other vessels that would 
come in full of crude oil and leak and what not? Wouldn't the 
way to minimize uncertainty be to allow pipelines and plants 
that would use natural gas for electric generation? I mean, 
that seems to me like that would minimize uncertainty, which is 
such a prevalent term in this legislation.
    Mr. Rosenbusch. Madame Chairman, I appreciate that 
question. It would--I guess in my own mind, be inappropriate 
for me to second guess what the stakeholders and the citizens 
of Florida consider to be an inappropriate activity. But, we 
would certainly suggest that the process that we have in place 
contemplates both the science that is needed and the concerns 
of the citizens before any decision is made. Whether a platform 
is considered more or less harmful is actually sometimes more 
in the eye of the beholder.
    Mrs. Cubin. One last question for you, Mr. Hakes. How do 
you think Florida will likely meet the increased deficiency in 
the needs that it has for electricity in the next five years? 
Are natural gas fired combined cycle turbines the likeliest new 
source, do you think?
    Mr. Hakes. Yes. We believe that in most areas of the 
country, that the gas fired plants are more economical than 
their competitors, because of the lower capital cost, and I 
believe that's also the case in Florida.
    Mrs. Cubin. Do you know if there are any plans to build 
pipelines to Florida or are there any pending construction 
projects that you know about?
    Mr. Hakes. There have been some expansions to the pipeline 
capabilities into Florida and there has been public discussion 
of substantially enlarging that pipeline capacity.
    Mrs. Cubin. And so, you think that's where it will come 
from then, from--see, that would be great for my state, if we 
could send gas to Florida. But----
    Mr. Hakes. We project nationally that the market for 
natural gas will grow from about 22 trillion cubic feet now to 
about 30 trillion cubic feet in about 2013, and that's, again, 
because in most areas of the country, these gas fired electric 
plants are so attractive economically.
    Mrs. Cubin. They're cleaner. Yeah, of course, you know, 
coal, too.
    Well, thank you, very much. Mr. Underwood?
    Mr. Underwood. Thank you, very much, and Mr. Rosenbusch, 
congratulations on your position. You did well today.
    Basically, I wanted to kind of understand the impact of Mr. 
Goss's bill. As I understand it, what would be the difference 
between what exists in California today, in the manner in which 
leases are dealt with, and the system that's being proposed by 
Mr. Goss?
    Mr. Rosenbusch. Today, the process that's in place for 
California is the same process that we have in place for any 
other area that's included in the five-year program, and that 
is a process that incorporates the OCS Lands Act, the National 
Environmental Policy Act, and the Coastal Zone Management Act, 
working in tandem. That is a process where--at each step along 
the way--whether it's in evaluating whether that acreage should 
be included in a five-year program, all the way through to 
ultimately where some activity, some specific action on a 
lease, you look at whether it is consistent with local--and 
state and concerns and Coastal Zone Management Act policies as 
well. The process is not any different. It is the same.
    In terms of the process is that is out there in California, 
that is not what Mr. Goss is asking for in his legislation. I 
believe what Mr. Goss is asking for for is something that's 
different.
    Mr. Underwood. Okay. What would be the net effect of 
implementing Mr. Goss's, other than having additional studies? 
Structurally, how would--you know, how would that either 
facilitate or impede your work or how would that facilitate or 
impede good public policy, in your estimation?
    Mr. Rosenbusch. Our concerns, if I will, are that it would 
impede the process that is currently in place, the process I 
earlier discussed that incorporates the OCS LA, NEPA, and the 
CZMA. That process allows for a continuing dialogue with than 
affected state. Our concerns are that if Mr. Goss's 
legislation, if becomes a public law, it would, if you will, 
delay the dialogue--necessasary to identify concerns, and 
identify cxoncerns and issues or until the end of 2012 or until 
such time there is enough environmental information out there 
to make a decision.
    Mr. Underwood. Okay. Thank you for those answers.
    Mr. Hakes, how many--I'm trying to understand the impact of 
these charts about whether Florida is energy self-sufficient. 
How many states would you estimate are energy self-sufficient 
or--how many states would you estimate?
    Mr. Hakes. Well, I mean, clearly, Texas, Louisiana. I think 
some of the western states might be; but, certainly, most of 
them are not and the country certainly is not. We import most 
of our oil now. And although the vast majority of gas is 
domestic, we are importing an increasing share from Canada.
    Mr. Underwood. Okay.
    Mr. Hakes. I could probably calculate that for you, if you 
would like that in the record. I just don't know it off the top 
of my head.
    Mr. Underwood. No, I'm just wondering whether the 
importance of the charts is to show that Florida needs a 
pipeline from Wyoming.
    [Laughter.]
    Mrs. Cubin. Maybe not from Wyoming.
    Mr. Underwood. Thank you.
    Mrs. Cubin. Mr. John?
    Mr. John. Mr. Underwood, if you wouldn't mind, I could 
maybe give you some idea of states that are self-sufficient. 
Over 80 percent of the oil and gas exploration in the OCS is 
done right off the coast of my home state of Louisiana, so we 
are a huge producer of oil and gas out in OCS.
    Mr. Rosenberg, I--Rosenbusch, I'm sorry, I have seen some 
conflicting numbers. As you are aware, there is a bipartisan 
group of members of this Committee--there's a congressman 
working on a pretty extensive, pretty wide sweeping outer 
continental shelf revenue sharing piece of legislation--and 
we've been basing it on some numbers and trying to build a 
consensus. And, actually, it's going very, very well. I see in 
your testimony, where you said that six billion dollars came 
into the Federal treasury in 1998. We had done--yeah, in 1988. 
Using some figures that we have been dealing with was four 
billion that was given to us early on in the process and then, 
of course, in the President's budget, we are now dealing with 
2.875 or 2.825 or something like that, and that was based, from 
what I understand, on about $14 oil.
    Have you done any recalculations--now that the price albeit 
a short term, but has definitely bumped up and is bumping up at 
the $20 barrel or right underneath it, have you done any 
recalculations on the total effect or the total receipts of 
offshore oil and gas?
    Mr. Rosenbusch. I believe we have updated our calculations. 
Part of the confusion lies in fact that oftentimes we talk 
amongst ourselves about total receipts that are collected by 
Minerals Management Service and then, it could be only be 
onshore receipts, or it could be OCS receipts. And so, I think 
that our latest number is around $3 billion, but I would be 
glad to provide any additional information that we have, in 
terms of the latest numbers.
    Mrs. Cubin. Mr. John?
    Mr. John. And I understand the volatility of that industry 
and that market. It is a moving target and moves daily.
    Also, I want to talk about the trends in the non-moratoria 
areas of the OCS, with lease sales. Where do you see that 
going, as far as its impact on the total amount of revenue? I 
mean, is it increasing 5, 10 years down the road? Is it 
decreasing, you know, with the technology and the offshore--and 
the deep water that's--that's starting to develop today? Do you 
see it increasing or decreasing?
    Mr. Rosenbusch. In short, I'd see it increasing, but I 
would have to say that probably--there are some caveats to that 
and I would be glad to--and let me just sort of itemize a few 
of those and then be glad to provide some additional 
information for you.
    For instance, the Gulf of Mexico has about, in terms of 
deep water leasing, and the activity is going to--has gone from 
1,000 leases now to 4,000 leases that are under lease in the 
Gulf of Mexico. A lot of the production that we have--the 
production increases that we're seeing today are actually from 
leases that were let prior to the Deep Water Royalty Relief 
Act. The new acreage that is under lease, that probably won't 
be coming on line for another two or three years. And so, I 
think that there are going to be some increases there, but 
they're going to be--it will really depend upon, as you know, 
the success of the exploration plan or the exploration effort, 
as well as the market, what's available--what the price is, I 
guess, basically, in terms of whether or not to move forward or 
when to move forward on those--on that project.
    Mr. John. And I guess being from Louisiana, we have chosen 
to be a producing state and have benefited from all of the 
economics of that industry, and other states have chosen to 
stay out of that. And I guess my concern, not only as a state 
legislature in Louisiana that served on the resources 
Committee, but also up here in Congress, is that although we 
get a lot of the benefits from it, I am very much concerned 
about our domestic oil and gas industry, as a whole, in the 
United States. And I don't--and shove to the side the economic 
benefits of it, I see this, as one of the gentlemen mentioned 
earlier, as a national security problem. And you look at it, 
time and time again, and read history and read books about 
military conflicts and what has brought people down and what 
has brought--what has survived from the strongest countries, 
and it is oil and gas--I mean, it is the gas industry. So, I am 
very, very concerned about our industry and what we're doing 
and what we are not doing to try to make sure that that's a 
thriving industry, because importations, as we very well know, 
we are addicted to the importation of the cheap oil, which is 
great for a lot of folks, but we need to look at the big 
picture.
    And I guess my last question, as it relates to H.R. 33, do 
you feel that your office and your department have the 
appropriate resources and manpower to look at some of the data 
and do the kinds of studies that H.R. 33 is trying to do in the 
first place? I mean, obviously, H.R. 33 is wanting to buy some 
time, because there are obvious differences in the water 
bottoms of Louisiana, the Gulf of Mexico, and the mouth of the 
Mississippi, and the beautiful beaches in Florida. But tell us 
a little bit--or if you could help me understand, does your 
department do that now? Do they have the resources to do that 
and how--would it just be a buying of time type thing, when we 
may have that data and the resources to gather that?
    Mr. Rosenbusch. To answer the first part of your question, 
``yes,'' we do have the resources. That is part of our mandate 
and a part of our budget request and appropriations that we get 
each year. We use some of these funds to perform environmental 
studies, on areas involved in pre-leasing activities or for 
studies for an EIS associated with a specific activity that 
being proposed, like a drilling permit or such.
    Mr. John. Right.
    Mr. Rosenbusch. So, I think we have those resources. But 
that's not the entire question. I would simply state, in 
response to your second part of the question, whether it's 
extending the time or buying additional time, I would just say 
that we believe that what's being proposed in H.R. 33 would be, 
at best, a duplicative effort. We already have a process that 
Congress has given us and that we have taken, at least in the 
six years that this administration has been responsible for 
management of the OCS, we have taken very seriously. We 
understand that it requires a consensus effort as well as good 
science. It's a deliberative and consultative process.
    Mr. John. Thank you, very much.
    Mrs. Cubin. I thank the witnesses for their testimony and 
the members for their questions. The members may have some 
additional written questions that they'll submit and we'd 
appreciate--we'll keep the record open for those responses. 
Thank you, very much.
    Mr. Rosenbusch. Thank you, very much.
    Mr. Hakes. Thank you.
    Mrs. Cubin. Now, the third panel, which is just one person, 
Charlie Bedell, with Murphy Exploration and Production Company, 
would please come forward. Welcome. The Chair recognizes Mr. 
Bedell.

    STATEMENT OF CHARLES A. BEDELL, MURPHY EXPLORATION AND 
  PRODUCTION COMPANY, NATIONAL OCEAN INDUSTRIES ASSOCIATION; 
  AMERICAN PETROLEUM INSTITUTE; U.S. OIL AND GAS ASSOCIATION; 
    INDEPENDENT PETROLEUM ASSOCIATION OF AMERICA; DOMESTIC 
 PETROLEUM COUNCIL; NAD INTERNATIONAL ASSOCIATION OF DRILLING 
                          CONTRACTORS

    Mr. Bedell. Thank you, Madame Chairman and members of the 
Subcommittee. I'm very proud to be here today. I almost 
hesitate to read the list of groups I'm representing. It will 
take up most of my time, but it is the National Ocean 
Industries Association, the American Petroleum Institute, U.S. 
Oil and Gas Association, the Independent Petroleum Association 
of America, the Domestic Petroleum Council, and the 
International Association of Drilling Contractors. All these 
groups have made substantial and valuable input and we thank 
them all for helping us in the preparation of this testimony. 
My name is Charles Bedell. I'm the Manager worldwide for 
environmental regulatory compliance for Murphy Exploration and 
Production Company in New Orleans, Louisiana. We understand 
that the written testimony will be included in the record and 
we have made some specific references in that testimony to 
specific provisions of H.R. 33. And so, I would just like to 
react, being the last person testifying here, to some of the 
things that I've heard today and perhaps address a few 
specifics.
    What we're really talking about here today seems to be 
communication, and the balancing, of Federal and state powers, 
jurisdictions, responsibilities, things that aren't new or 
applicable to just this subject, but which--I think have come 
into pretty clear focus, as we've listened to the testimony 
today. I'm really glad to hear some of the things that the 
distinguished gentleman from Florida, Mr. Goss, has said, as he 
introduced his bill and explained it. We're glad to see that he 
sees that there is some possibility for actual accommodation 
and that exploration and development activities, production 
activities may, in fact, some day be able to go on in concord 
with the State of Florida.
    The other areas of agreement seem to be that Florida does 
need energy and it's going to need increased electrical, 
capacity, and that natural gas is the fuel of choice, to fuel 
that expansion. And, of course, that's a national expansion, a 
national need, as you pointed out.
    And what we have trend is. The real basis of this problem 
is how do we really communicate together on these things. As in 
the warden in Cool Hand Luke said, what we have here is a 
failure to communicate, and I guess we really do, 
unfortunately. On the one hand, we have citizens, who are 
living along the coast. They have their present lifestyle and 
they enjoy it, rightly so. Then maybe groups will get formed 
when they perceive a threat and they become a little more 
militant and the word ``fight'' begins to creep into the 
conversations between all the stakeholders.
    And on the other side, you have people like myself, who 
work 24 hours a day, seven days a week, and 365 days a year, 
and do it for a whole career and they're all through the oil 
industry with the real dedication to bring about environmental 
safety and compliance with regulations. The MMS testimony, I 
think, clearly shows that we have had a very, very good record 
and our operations are safe and they protect the environment. 
And, actually, studies are beginning to document the fact that, 
as far as red fish and some their polulation has approximately 
doubled what they would be, if it wansn't for the productuction 
platforms that exist now in the Gulf of Mexico.
    So, we have, on the other side, folks who are worried 
that--I think there's a group called Gulf Coast Environmental 
Defense that said that fisheries will be closed down and they 
said they'd be closed down for two seasons after drilling 
begins, and, of course, we've had 36 wells drilled already--off 
Florida already exploration wells. There was no opposition to 
the environmental impact study that has already been done in 
Florida for the Destin Dome Project. And so, we have a 
situation where scientific information has piled up. Since I've 
been involved in this for about 25 years, I speak with some 
authority, when I say that there's probably more scientific 
information out there than people can effectively deal with.
    Back in 1979 through 1982, I was a member of the Gulf of 
Mexico Regional Technical Advisory Committee that the 
Department of Interior had, at the time, under the OCS Lands 
Act. And when we looked at the budget for MMS, one of our 
initial recommendations was that these new things called 
computers be used to try to come up with common formats and to 
expedite the access of the scientific community and the 
decision makers in government to studies that were available. 
So, we don't see that adding a new group of people, a committee 
to review and ask for more studies, that is found in this bill, 
will lead to any real resolution of the problem.
    We agree with MMS that the present regulatory situation is 
one that's adequate, and that it has involved the states. And 
if I had brought along--for instance, on that Destin Dome 56 
project, the application for the permit to go forward with 
development it would cover this tabletop and includes four 
million dollars worth of scientific studies and surveys, things 
that go beyond the requirements of the regulations, due to the 
fact that our operator, Chevron, made specific contacts with 
the State of Florida and with EPA, with all agencies involved, 
so that we could proceed and get facts that they wanted before 
we had conflict. And, unfortunately, we haven't been able to 
avoid that.
    So, we urge that the Subcommittee reject this bill, at this 
time, and give the present system a continued opportunity to 
function and to allow us to try to deal with the issues of who 
can offshore development through that system. With the 
assistance of MMS and their increasingly active role in public 
education and through groups like NEED, The National Energy 
EEducation Developement Project, and others, we think that this 
may be able to work, hopefully, in the end. Thank you, again, 
for the opportunity to appear today.
    [The prepared statement of Mr. Bedell follows:]
    Mrs. Cubin. Thank you for being here. I want to follow up 
on one of Mr. Joyner's statements regarding the National 
Research Council's call for further studies. Could you, please, 
describe for me the range and scope, you know just short, of 
the studies that you and your partners have caused to be 
performed on the Destin Dome project?
    Mr. Bedell. Yes, I'd be happy to supply the Subcommittee 
with the precise list and can do that in pretty short order, 
hopefully. One of the things was photo documentation of the 
bottom. There have been a lot of comments about the difference 
between the eastern part of the Gulf and the western, and I'm 
sure there are some. My undergraduate training is in biology, 
ecology, and animal behavior, but I went wrong and went to law 
school, I guess. I think that there aren't as many differences 
between these areas, as some might like to believe.
    We did shoot, I think--and please don't hold me exactly to 
this--but around 1,000 miles of video tape with a remote 
operated vehicle going along the bottom and saw a lot of mud, a 
lot of sand, and very little life. There's a lot better quality 
and a lot more life around platforms, frankly, than there is on 
the bottom of the area of the Dustin Dome 56 unit. This is very 
expensive work. It was not even required. Socioeconomic studies 
are also involved. Everything that's been raised as an issue of 
concern, and legitimately so by the people of Florida and 
through Congressman Goss, all these things are being addressed. 
And sometimes one feels like that we're saying something, but 
there's nobody there listening at the other end.
    Mrs. Cubin. The lights on, but nobody is home.
    Mr. Bedell. Yes, ma'am.
    Mrs. Cubin. Would you tell me just a little bit more about 
the project. I think it's a dry glass--dry gas play, isn't it?
    Mr. Bedell. Yes, ma'am.
    Mrs. Cubin. Is there potential to get this natural gas to 
Florida in a relatively direct way?
    Mr. Bedell. Well, absolutely. As I believe the gentleman 
from Florida stated, we, in the initial planning process, had 
talked to folks along the coast. But there was apprehension 
about the method for getting the gas to shore, they didn't want 
it to cross the State of Florida or go in across their beaches. 
Now, I have to add that during the time when when I was the 
minority counsel for the Ad Hoc Select Committee on the Outer 
Continental Shelf here in the House, we went to Scotland and 
did some field hearings of what was going on there, as far as 
North Sea development in the mid-'70s. We were taken to a golf 
course, where huge pipelines came ashore underground. We talked 
to farmers and they had huge pipelines going through under 
their pastures and there wasn't any problem.
    I would like to add, also, that there is a document that 
the Committee should probably take note of with regard to the 
studies that the gentleman from Florida referred to. The 
National Research Council and National Academy of Sciences 
studies. It is an MMS document called ``Cumulative Effects.'' 
This is the latest version. It was published in 1997. It covers 
1992 to 1994. It shows the cumulative effects of the Outer 
Continental Shelf Oil and Natural Gas Resource Management 
Program and in it how the MMS directly addressed those requests 
for additional information and the alleged shortcomings of the 
system at the time when the National Research Council made its 
recommendations. It shows the degree to which the MMS has tried 
to address those needs, and I think successfully so.
    Mrs. Cubin. Thank you. Thank you for being here. I thank 
the staff for all of their hard work. We look forward to seeing 
you again. As I said earlier, the record will be held open for 
written responses that any Committee members might have. And so 
if there's no further business, this Committee hearing is 
adjourned.
    [Whereupon, at 3:29 p.m., the Subcommittee was adjourned.]
    [Additional material submitted for the record follows.]
 information and literature on other prairie wildlife species as well, 
                       to determine their status.

    The black-tailed prairie dog is the cornerstone of the 
network of prairie wildlife species. The prairie dog colonies 
are home or otherwise provide food and cover to as many as 150 
other species in the short-grass and mixed-grass prairie 
ecosystem. Unfortunately, many of the colonies of prairie dogs 
that remain in these ecosystems are fragmented and cover only a 
small acreage. These small ``islands'' of prairie dogs that are 
so commonly seen along the Front Range simply do not support 
the kind of matrix of wildlife species that rely on prairie dog 
colonies for survival.
    We are heading for a ``train wreck'' through the loss of 
species diversity associated with prairie dog colonies and 
within the short-grass and mixed-grass prairie ecosystem. The 
National Wildlife Federation is taking steps to help stop this 
train wreck from occurring.

Prairie Dogs Are a Threatened Species

    In July 1998, the National Wildlife Federation filed a 
petition with the U.S. Fish and Wildlife Service to list the 
black-tailed prairie dog as a threatened species under the 
Endangered Species Act. Since then, we have been working 
closely with the states to develop state management strategies 
for black-tailed prairie dogs, and trying to put a stop to 
poisoning of prairie dogs on Federal lands. In addition, the 
National Wildlife Federation is taking action to secure a home 
for prairie dogs and prairie wildlife on the National 
Grasslands.

 information and literature on other prairie wildlife species as well, 
                       to determine their status.

    The black-tailed prairie dog is the cornerstone of the 
network of prairie wildlife species. The prairie dog colonies 
are home or otherwise provide food and cover to as many as 150 
other species in the short-grass and mixed-grass prairie 
ecosystem. Unfortunately, many of the colonies of prairie dogs 
that remain in these ecosystems are fragmented and cover only a 
small acreage. These small ``islands'' of prairie dogs that are 
so commonly seen along the Front Range simply do not support 
the kind of matrix of wildlife species that rely on prairie dog 
colonies for survival.
    We are heading for a ``train wreck'' through the loss of 
species diversity associated with prairie dog colonies and 
within the short-grass and mixed-grass prairie ecosystem. The 
National Wildlife Federation is taking steps to help stop this 
train wreck from occurring.

Prairie Dogs Are a Threatened Species

    In July 1998, the National Wildlife Federation filed a 
petition with the U.S. Fish and Wildlife Service to list the 
black-tailed prairie dog as a threatened species under the 
Endangered Species Act. Since then, we have been working 
closely with the states to develop state management strategies 
for black-tailed prairie dogs, and trying to put a stop to 
poisoning of prairie dogs on Federal lands. In addition, the 
National Wildlife Federation is taking action to secure a home 
for prairie dogs and prairie wildlife on the National 
Grasslands.

I., State Management Strategies

    National Wildlife Federation staff sat down with 
representatives from Wyoming, South Dakota and Colorado in 
January 1999 to begin exploring ideas for a coordinated state 
strategy to address prairie dog management in the ten states 
with black tailed prairie dogs. In March of this year, the 
state of Colorado hosted a meeting of the ten prairie dog 
states to start a formal dialogue on interstate coordination 
for prairie dogs. The result of this effort is an Interstate 
Strategy for the Management of Prairie Dogs, which was 
submitted to the Western Association of Fish and Wildlife 
Agencies for their review in July 1999 at their meeting in 
Durango.
    We are expecting this Strategy to be favorably received, 
and will be working with individual states, including Wyoming 
and Colorado, to develop state-specific management plans. By 
the end of this year, or early in 2000, we hope to have 
comprehensive management plans in place in all the states with 
black-tailed prairie dog habitat.
    I will use my allotted time to highlight some of those 
successes, and to discuss the challenges we are facing in the 
future in the restoration and protection of prairie wildlife 
species.

Bald Eagle Recovery

    As a symbol of our Nation and a spiritual icon for Native 
Americans throughout the West, the restoration of populations 
of the bald eagle is particularly note-worthy. When the 
Endangered Species Act was enacted, the species of bald eagles 
had suffered severe declines due to habitat loss and pesticide 
use. This summer, the Secretary of the Interior announced that 
the bald eagle populations in the country have recovered to the 
point that the eagle has been removed from the Federal 
Endangered Species list. Due to the work of countless 
individuals and the assistance of many government agencies at 
the Federal, state and tribal, and local levels, the bald eagle 
once again soars above many areas in the United States.

Wolf Recovery

    Another important symbol of freedom and strength is the 
gray wolf. These animals were virtually exterminated from the 
lower 48 states through both government and private control 
programs. When the Endangered Species Act was passed, wolves 
were one of the original species listed. America's hearts were 
lifted as the pen door was opened in 1995, and the first wolves 
were released by the Secretary of the Interior into the 
Yellowstone ecosystem. Today, in Yellowstone and elsewhere, we 
are seeing the results of two decades of efforts to recover the 
wolf populations, with animals expanding their range in 
Wyoming, Montana, Idaho and even into Oregon. Some day, we hope 
to have populations of wolves roaming in Colorado as well, 
which was part of the historic range for the species.
    The success story with wolves means that we will soon be 
able to delist the wolves from the Endangered Species Act in 
the Rocky Mountain West. As a first step, the U.S. Fish and 
Wildlife Service will soon propose down-listing wolves from 
their present endangered classification to a classification as 
a threatened species. This action will help put the natural 
populations of wolves that are expanding in the West on the 
same footing as the experimental populations of wolves in 
Yellowstone Park and Idaho and will pave the way for total de-
listing early in the next century.
    The National Wildlife Federation is working with the U.S. 
Fish and Wildlife Service on these efforts and anticipates 
strongly supporting the down-listing proposal. However, we 
still need to work with the states to come to grips with wolf 
management and develop a program for each state with wolf 
populations.
                                ------                                


         Statement of Coalition for Sustainable Resources, Inc.

    (CSR) is a Colorado nonprofit corporation which was formed 
for the purpose of encouraging the prompt recovery of species 
designated as threatened or endangered under the Federal 
Endangered Species Act, using sound scientific, technical, and 
legal means, and in a manner which avoids unnecessary 
interference with private property rights.
    CSR is very concerned that the proposed recovery programs 
for the listed threatened and endangered species in the Platte 
River Basin will interfere with private property rights and 
fail to recover the endangered species, primarily because of 
U.S. Forest Service management practices on the national 
forests at the headwaters of the Platte River. Because of these 
concerns, CSR submits the attached written comments and 
exhibits to the Committee for inclusion in the printed hearing 
record.
    Sincerely,
    Kurt Bucholz, Vice President,
    Coalition for Sustainable Resources, Inc.

           *       *       *       *       *       *       *


                                Summary

    The production of high-quality water from forested 
watersheds is dependent upon healthy forests. Reduced water 
yield is an early symptom of forests that are losing diversity 
due to aging stands. Later symptoms of an unhealthy forest 
(which often degrade water quality) include increasing 
mortality from insects, disease, and blowdowns, in addition to 
the increasing frequency of catastrophic fires. Historic U.S. 
Forest Service management practices have significantly 
decreased water production in the Platte watershed. Continuing 
reductions in water yield caused by USFS management practices 
jeopardize the continued existence of downstream endangered and 
threatened species in Nebraska and undermine recovery program 
efforts to achieve target flow goals established by the U.S. 
Fish & Wildlife Service.

FOREST COVER AND STREAMFLOW

    From 30 to almost 75 percent of the annual precipitation 
that falls upon the forested headwaters of the Platte River is 
consumed by mature forest vegetation through the complex 
processes of evapo-transpiration. Much has been learned about 
these processes from research in forest hydrology. Simply put, 
dense forest cover results in more evapo-transpiration, lower 
levels of soil moisture, with less water available for 
streamflow (Leaf, 1999a). More than 80 years of watershed 
research throughout the United States, much of which is 
specifically oriented toward the West, has demonstrated that 
timber harvest, or vegetation removal, reduces net evapo-
transpiration and results in increased streamflow. Studies have 
shown similar responses occur following deforestation due to 
insect epidemics and fire (Troendle, 1998). The amount of 
increased streamflow created can be accurately estimated by the 
USFS-developed WRENSS handbook procedure.
    As trees reoccupy a site after logging or natural 
disturbances such as fire, blowdown, and/or insects, water use 
increases with time until the conditions of maximum water use 
(complete hydrologic utilization) of a fully occupied forest 
are reestablished. Results from the Fraser Experimental Forest 
show that lodgepole pine in the subalpine zone reaches complete 
hydrologic utilization in about 80 years, and spruce/fir in a 
little over 100 years. Aspen reaches complete hydrologic 
utilization in about 30 years (Leaf, 1999a).

HISTORIC BACKGROUND

    A century ago, many forests on the public domain were 
ravaged by fire and unregulated logging. Water spilling off the 
denuded and fire-glazed watersheds created damaging floods in 
the spring and after storms, followed by periods of extremely 
low flows later in the season. Those flow patterns interfered 
with agriculture, commerce, and prosperity.
    Fear arose that forest lands might soon disappear, leaving 
the country with a shortage of both timber and healthy 
watersheds. Congress responded by passing the Organic 
Administration Act of 1897, which outlined the primary purposes 
of the national forests as (1) securing favorable conditions of 
water flows, and (2) furnishing a continuous supply of timber 
the use and necessities of the citizens of the United States 
(USvN, 1978).
    The Multiple Use-Sustained Yield Act of 1960 provided 
additional direction. This act is ``supplemental to, but not in 
derogation of'' the Organic Act (USvNM, 1978; Steen, 1976 at 
page 307). It authorizes the Forest Service to manage for 
range, recreation, wildlife, fish, and other purposes in 
addition to, but not in place of, management for the primary 
timber and water responsibilities for which the national 
forests were established.
    The forested headwaters of the Platte River experienced 
large-scale disturbance events prior to the time they were 
added to the national forest system. Early records from Larimer 
County, Colorado (1886) and the USDA Bureau of Forestry (1904) 
suggest that 60 percent of northern Colorado's forests had been 
recently disturbed and consisted of seedlings, saplings, or 
were still black from recent fires (USFS, 1994). As a result of 
those disturbances, forests of a century ago in the Platte 
basin had many large openings and contained a large proportion 
of young timber stands.
    Prior to World War II, the Forest Service sold a modest 
amount of timber while allowing the previously disturbed areas 
to restock. Harvest increased during and after WW II, and 
remained fairly constant for the next four decades. A steady 
decline in the rate of harvest has been experienced since the 
early 1990s. Timber harvest has always been less than the rate 
of growth. For example, harvest on the Medicine Bow National 
Forest averaged about 23 percent of the current growth rate 
until 1950, 43 percent from 1951 to 1984, and is currently only 
12 percent of the growth rate (USFS, 1985 at 111-57; USFS, 1998 
at Page 36).
    Harvesting at far less than the rate of growth while 
suppressing fire, insects, and disease has led to serious 
overstocking that is increasingly being recognized by experts 
in the field. Former Regional Forester Elizabeth Estill made 
the following statement during a 1997 address to the Colorado 
Legislature's Joint Committee on Agriculture and Natural 
Resources:

        ``We are growing much more wood than we are harvesting,'' 
        Estill said. ``Our forests are heavily stocked--many in excess 
        of natural levels--and (at) high risk for disturbances like 
        fire and insects.'' (Estill, 1997).
        Dave Blackford, former Renewable Resources Group Leader of the 
        Medicine Bow-Routt National Forest, commented on stand age and 
        size at a 1995 public meeting in Saratoga, Wyoming:
        The USFS was then asked what the age of the medicine Bow was 
        and if there was a decrease in timber due to a lack of growth. 
        Blackford said the answer would surprise most people. ``The 
        stands in both the Medicine Bow and Routt are older than they 
        have ever been and bigger than they've ever been,'' Blackford 
        said. ``The reason is that for the last 100 years we have made 
        every effort to control fires and insects.''(Blackford, 1995).

    Dr. Denny Lynch of the Colorado State University College of Natural 
Resources gave the following testimony to the United States House of 
Representatives Subcommittee on Forests and Forest Health on March 18, 
1997:
    Studies of paired photographs taken at the turn of the century and 
more recently, consistently suggest that forest areas have recovered 
and even increased substantially . . . . In short, today's forests seem 
to be at the edge or outside the range of what we expect for the normal 
conditions, or what ecologists refer to as the ``1range of natural 
variability.'' . . . When forest canopies close and rain or snow is 
evaporated back into the atmosphere before reaching the forest floor, 
we lose valuable water supplies (Lynch, 1997).
    As forest stocking levels have increased to the edge or outside the 
range of natural variability, water yield from those forests has 
inevitably decreased to the edge or outside the range of natural 
variability.
    National forests are over stocked with over-aged timber. While 
experts recognize this problem, USFS has taken no corrective steps to 
remedy the situation. Instead, the problem has been compounded by USFS 
management decisions to reduce timber harvest.
    As the forest continues to grow, individual forest communities will 
gradually move into the more mature structural stages. This maturation 
will be accompanied by an increase in crown cover . . . . 61 percent of 
the forested lands are mature, and the percentage of forested land in 
mature condition is projected to increase under all alternatives. 
(USFS, 1997 at 3-89, 3-111).
    The Platte Basin Forests are not unique in regard to overstocked 
conditions due to an inadequate level of timber harvesting. Based on 
current harvest levels, it is estimated about .4 percent of the 
forested area in the Central/Southern Rocky Mountains is altered by 
timber harvest in a 10 year period.
    At this rate it would take about 200 years to disturb 8 percent of 
the forested landscape, and 2500 years to disturb all of it (USFS, 
1999).
    History and timber inventory data show that half or more of the 
forested watershed in the Platte basin had been recently disturbed 
prior to establishment of the national forests. The disturbed areas 
have been reoccupied by forest while under USFS stewardship, and that 
forest has steadily grown from the stage of minimum water use toward 
the stage of maximum water use. A recent analysis of stand age and 
stocking levels on the Medicine Bow-Routt National Forests, combined 
with an analysis of historic gaging station records, led to the 
conclusion that the 1945-1996 yield from national forest lands above 
Saratoga, Wyoming was 116,000 acre feet per year less than the yield 
experienced during the 1904-1944 period (Leaf, 1999a).
    The present harvest rate on the Medicine Bow-Routt has decreased to 
less than a third of the harvest rate of the previous four decades, so 
for every acre harvested there are more than two previously harvested 
acres being reoccupied by trees that are growing toward complete 
hydrologic utilization and maximum water use. It is estimated that the 
yield upstream of Saratoga, Wyoming will decrease another 16,500 acre 
feet per year over the next 50 years if present management policy 
continues (Leaf, 1999b).

        Other methods were considered but would cause unacceptable 
        environmental damage. For example, allowing wildfires to burn 
        and regenerate forested areas has historically been 
        unacceptable because of the smoke that pollutes the air, 
        sediment that pollutes the waters, and the complete altering of 
        the Forestenvironment that results from wildfires. (USFS, 1985 
        at 11-44).
        However, the probability of fire events that would mimic early 
        conditions are remote since agricultural uses in the lower 
        valley areas and social acceptance of large free running fire 
        have and will continue to influence wildfire suppression. 
        (USFS, 1997 at D-64).

        Because fire cannot be allowed to return to its historic 
        levels, forest age and density will always remain above 
        historic levels (and water yield below historic levels), unless 
        USFS intervenes and actively manages the vegetative cover on 
        national forest lands.

DOWNSTREAM ENDANGERED SPECIES

    The whooping crane, piping plover, interior least tern, and pallid 
sturgeon have been listed as a threatened or endangered species 
pursuant to the Endangered Species Act, and Critical Habitat has been 
designated for protection in the Central Platte Region of Nebraska. The 
U.S. Fish & Wildlife Service has been designated for protection in the 
Central Patte Region of Nebraska. The U.S. Fisg & Wildlife Service has 
determined that an additional 238,000 acre feet per year of water, over 
and above the existing flows, is necessary to meet target flows 
established for the listed speices in the Central Platte Region. 
Virtually all of the water avialable to the Platte is generated from 
snowmelt on densely forested Federal land, most of which is controlled 
by the USDA, Forest Service (Leaf, 1999a).Total gaged yield is some 2.5 
million acre feet per year and consumptive requirements are about 1.5 
million acre feet per year, leaving an annual flow of about a million 
acre feet through the Critical Habitat in Central Nebraska.
    Various forest plans for the Routt, Medicine Bow, and Arapaho/
Roosevelt National Forests, which straddle the continental divide, 
state that water yield from those Forests could be increased by 
approximately 400,000 acre feet per year., without degrading water 
quality or increasing flood peaks, by the implementation of vegetative 
and snow management programs. A substantial portion of this water would 
accrue to the Platte River, and the remainder would accrue to the 
Colorado River Basin above the critical habitat designated for the 
Colorado River endangered fish species. A moderate water yield 
management scenario would increase water yield in the Platte Basin by 
249,000 acre feet per year by patch cutting 50 percent of USFS lands 
classed as tentatively suitable for timber harvest over the next 50 
years, but does not include cloud seeding, snowfencing, or reentry of 
stands for thinning (Leaf, 1999a). Leaf (1999c) has shown that a 
significant portion of water generated by forest management practices 
will arrive at the Critical Habitat without interfering with the 
existing system of water rights administration. It is clear that 
restoration of water yield to historic levels from national forest 
watersheds would provide most, if not all, of the additional water 
necessary to meet target flows at the Critical Habitat.

USFS ACTION AND INACTION

    The U.S. Forest Service is required by both the Organic Act of 1897 
and the Multiple Use-Sustained Yield Act of 1960 to maintain watersheds 
in a condition of favorable flow. The Endangered Species Act requires 
each Federal agency to insure that any action authorized, funded, or 
carried out by such agency is not likely to jeopardize the continued 
existence of any endangered species or threatened species. Section 
7(a)(1) of the ESA imposes on USFS an affirmative obligation to utilize 
their authorities in furtherance of the purposes of the ESA by carrying 
out programs for the conservation of endangered species and threatened 
species.
    USFS promptly used the downstream threatened and endangered species 
as justification to require bypass flows or mitigation at the time of 
permit renewal for water diversion facilities located on national 
forest lands. In one case, USFS concluded that annual evaporative water 
depletions of 0.7 acre feet off a pond located on the Arapaho-Roosevelt 
National Forest would, unless mitigated, harm the downstream endangered 
species and their habitat.
    USFS also concluded that the cumulative effects of small depletions 
from ponds and spring developments for livestock, and wells for cabins, 
campgrounds and work centers, harm the downstream endangered species 
and their habitat. Under an interagency agreement, USFS paid $95,000 to 
the Fish & Wildlife Service to mitigate the calculated 504 acre feet of 
annual small depletions to the Platte Basin.
    While USFS has addressed the effects of small depletions on the 
downstream listed species, it has ignored the huge depletions caused by 
its management practices. The agency refutes its own science and three-
quarters of a century of gage records and states that there has been no 
significant decline in water yield in the Upper North Platte over the 
last 80 years. (USFS, 1997, Comment Response Report at 403).
    Older forest plan revisions followed NFMA regulations and offered a 
wide range of alternatives, including one that emphasized water yield. 
Recent plan revisions have not offered an alternative to increase water 
yield, and the management prescription for increased water yield has 
been dropped.
    The Routt NF has recently adopted unrealistic and misleading 
baseline water yields that are apparently based on the yield from a 
mature forest that is in the stage of complete hydrologic utilization. 
Considering water yield from a forest that consists entirely of mature 
stands as a baseline is as reasonable as expecting all the people in 
Colorado to be over the age of 50.
    Instead of providing water for the downstream listed species, USFS 
is using those species as a tool to gain additional control over 
privately-owned water diversions located on national forest lands. It 
is clear that the Federal agencies wish to ignore their own research 
and legal obligations, and instead place the burden of recovering the 
listed species on the backs of resource users.
CONCLUSION

    Forest Service research shows that a watershed maintained in a 
condition of favorable flow will have enough forest cover to prevent 
floods, yet will have openings to catch snow and promote runoff. At the 
same time, the forest must not be allowed to become so old or dense as 
to invite catastrophic stand replacement and subsequent watershed 
damage. The Organic Act directs the Forest Service to maintain those 
favorable conditions by removing excess fuel as wood products.
    Forests in the Platte watershed have grown old and dense under USFS 
stewardship and show signs of forest health problems in addition to 
conditions of unfavorable flow. Infestations of mountain pine beetles 
are increasing and an outbreak of spruce bark beetle seems likely after 
a 14,000 acre blowdown north of Steamboat Springs. Fires are becoming 
larger, more difficult to control, and are causing more damage. The 
May, 1996 Buffalo Creek fire southwest of Denver burned 10,000 acres of 
dense pine, claimed two lives, and has cost the City of Denver millions 
of dollars due to damage from sedimentation.
    The major purpose of vegetation treatment on the Forest is to 
create and maintain healthy, diverse forest communities. A healthy, 
diverse forest is more attractive for recreation use and scenic 
quality; provides habitat for a wide variety of wildlife species; and 
assures a steady flow of water and wood products for the use of society 
. . . . (USFS, 1984 at Preface i).
    The dangerous buildup of forest fuels is an urgent problem in 
Platte watersheds. USFS and state foresters have warned that a 2,500-
square-mile swath from north of Fort Collins to south of Colorado 
Springs is ripe for an Oakland-sized disaster (Oulton, 1996). A multi-
resource vegetation management program could easily be designed that 
would both increase water yield and reduce fuel loads. Prescribed fire 
and wildfire suppression costs would be greatly reduced, a very 
significant economic benefit, if such a program were implemented.
    In addition, the economic value of increased water yield averages 
from 6 to 10 times the value of timber products generated by watershed 
management (Gosnell et. al, 1987; Brown and Harding, 1987). Water added 
to the North Platte by watershed management would be at the upper end 
of that value range because of the many efficient hydroelectric 
generating facilities in that river system. A vegetation management 
program designed to increase water yield and improve forest health 
would maximize net public benefits.
    Instead of maintaining the watershed in a condition of favorable 
flow and providing water for citizens, USFS is depleting the river and 
causing the private sector to cover its depletions. The states of 
Nebraska, Wyoming, and Colorado are diligently working on a recovery 
program for listed species in the Platte Basin, but their efforts to 
achieve the target flows required by the Fish & Wildlife Service are 
doomed to failure as long as flows from national forest lands at the 
headwaters continue to decrease. It is time for USFS to obey the 
Organic Act, the Multiple Use-Sustained Yield Act, and the Endangered 
Species Act and join the recovery program.
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