Senate Bill 2898

AN ACT TO BE ENTITLED THE "DEEPWATER HORIZON OIL SPILL MISSISSIPPI GULF COAST RESTORATION OVERSIGHT ACT OF 2012"; TO MAKE CERTAIN FINDINGS ABOUT THE DAMAGE CAUSED BY THE DEEPWATER HORIZON OIL SPILL AND ITS EFFECTS ON THE PROGRAMS AND BUDGETS OF THE STATE OF MISSISSIPPI; TO ESTABLISH THE MISSISSIPPI GULF COAST RESTORATION FUND CONSISTING OF AMOUNTS TRANSFERRED TO THE STATE OF MISSISSIPPI PURSUANT TO THE FEDERAL "RESOURCES AND ECOSYSTEMS SUSTAINABILITY, TOURIST OPPORTUNITIES AND REVIVED ECONOMY OF THE GULF COAST ACT OF 2011" (R.E.S.T.O.R.E.) AND RELATED CIVIL ACTIONS; TO PRESCRIBE AUTHORIZED EXPENDITURES FROM THE FUND SUBJECT TO APPROPRIATION BY THE LEGISLATURE; TO AMEND SECTION 27-104-21, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT ANY ESCALATION OR EXPENDITURE OF FEDERAL FUNDS PROVIDED UNDER THE R.E.S.T.O.R.E. THE GULF COAST ACT SHALL BE SUBJECT TO SPECIFIC APPROPRIATION BY THE LEGISLATURE; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. This act shall be known and may be cited as the "Deepwater Horizon Oil Spill Mississippi Gulf Coast Restoration Oversight Act of 2012."

     SECTION 2.  The Legislature finds that:

          (a)  As a result of decades of oil and gas development in the Gulf of Mexico, producing and nonproducing states in the Gulf Coast region have borne substantial risks of environmental damage and economic harm, all of which culminated with the explosion on, and sinking of, the mobile offshore drilling unit Deepwater Horizon;

          (b)  The discharge of oil in the Gulf of Mexico that began following the explosion on, and sinking of, the mobile offshore drilling unit Deepwater Horizon has caused substantial environmental destruction and economic harm to the people and communities of the Mississippi Gulf Coast region;

          (c)  In the report entitled "America's Gulf Coast:  A Long Term Recovery Plan after the Deepwater Horizon Oil Spill," the Secretary of the Navy stated, "Together, the Gulf's tourism and commercial and recreational fishing industries contribute tens of billions of dollars to the U.S. economy.  More than ninety percent (90%) of the nation's offshore crude oil and natural gas is produced in the Gulf, and the federal treasury receives roughly $4.5 Billion every year from offshore leases and royalties.  And it is in the Gulf of Mexico that nearly one-third (1/3) of seafood production in the continental U.S. is harvested.  America needs a healthy and resilient Gulf Coast, one that can support the diverse economies, communities and cultures of the region";

          (d)  To address the needs of the Gulf Coast region, the Secretary of the Navy stated, "It is recommended that the President urge Congress to pass legislation that would dedicate a significant amount of any civil penalties recovered under the Clean Water Act from parties responsible for the Deepwater Horizon oil spill to those directly impacted by that spill";

          (e)  To mitigate local challenges and help restore the resiliency of communities adversely affected by the spill, the Secretary of the Navy stated that the legislation described in paragraph (d) of this section should "[b]uild economic development strategies around community needs, and take particular efforts to address the needs of disadvantaged, underserved, and resource constrained communities";

          (f)  In a final report to the President, the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling:

              (i)  Stated, "Estimates of the cost of Gulf restoration, including, but not limited to, the Mississippi Delta, vary widely, but according to testimony before the commission, full restoration of the Gulf will require $15 Billion to $20 Billion:  a minimum of $500 Million annually for thirty (30) years"; and

              (ii)  The Secretary of the Navy, recommended that, to meet the needs described in subparagraph (i) of this paragraph (f), a substantial portion of applicable penalties under the Federal Water Pollution Control Act (33 USC 1251 et seq.) be dedicated to long-term restoration of the Gulf of Mexico;

          (g)  Taking into account the risks borne by Gulf Coast states for decades of oil and gas development and the environmental degradation suffered by the Gulf Coast ecosystem, the amounts received by the United States as payment of administrative, civil, or criminal penalties in connection with the explosion on, and sinking of, the mobile offshore drilling unit Deepwater Horizon should be expended:

              (i)  To restore the natural resources, ecosystems, fisheries, marine and wildlife habitats, beaches, barrier islands, dunes, coastal wetlands, and economy of the Gulf Coast; and

              (ii)  To address the associated economic harm suffered by the people and communities of the State of Mississippi;

          (h)  The projects and programs authorized by the federal Resources and Ecosystems Sustainability, Tourist Opportunities and Revived Economy of the Gulf Coast Act of 2011 (R.E.S.T.O.R.E.) in Mississippi and the amendments made should be carried out pursuant to contracts awarded in a manner that provides a preference to individuals and entities that reside in, are headquartered in, or are principally engaged in business in Mississippi; and

          (i)  Federal, state, and local officials should seek:

              (i)  To leverage the financial resources made available under the federal R.E.S.T.O.R.E. Act in Mississippi; and

              (ii)  To the maximum extent practicable, to ensure that projects funded pursuant to this act complement efforts planned or in operation to revitalize the natural resources and economic health of the Gulf Coast region.

     SECTION 3.  (1)  Establishment.  There is established in the State Treasury a trust fund to be known as the "Mississippi Gulf Coast Restoration Fund" (referred to in this section as the "fund"), consisting of such amounts as are deposited in the fund under the federal Resources and Ecosystems Sustainability, Tourist Opportunities and Revived Economy of the Gulf Coast Act of 2011 (R.E.S.T.O.R.E.).

     (2)  Transfers.  The State Treasurer shall deposit in the fund an amount equal to all administrative and civil penalties paid by responsible parties after the date of enactment of this act in connection with the explosion on, and sinking of, the mobile offshore drilling unit Deepwater Horizon pursuant to a court order, negotiated settlement, or other instrument in accordance with Section 311 of the Federal Water Pollution Control Act (33 USC 1321), and transferred to the State of Mississippi.

     (3)  Expenditures.  Amounts in the fund, including interest earned on advances to the fund and proceeds from investment under subsection (4) of this section, shall:

          (a)  Be available for expenditure, subject to appropriations by the Legislature, solely for the purpose and eligible activities of subsection (5) of this section; and

          (b)  Remain available until expended, without fiscal year limitation.

     (4)  Investment.  Amounts in the fund shall be invested in accordance with Mississippi law, and any interest on, and proceeds from, any such investment shall be available for expenditure in accordance with this act.

(5) Eligible activities for the expenditure of amounts provided to the State of Mississippi under the federal Resources and Ecosystems Sustainability, Tourist Opportunities and Revived Economy of the Gulf Coast Act of 2011 (R.E.S.T.O.R.E.) and civil recoveries under subsection (2) of this section, which may be used to carry out one or more of the following activities:

                  (i)  Coastal restoration projects and activities, including conservation and coastal land acquisition in the State of Mississippi.

(ii) Mitigation of damage to, and restoration of, fish, wildlife or natural resources in the State of Mississippi.

(iii) Implementation of a federally approved marine, coastal or comprehensive conservation management plan, including fisheries monitoring in the State of Mississippi.

(iv) Programs to promote tourism in Mississippi.

(v) Programs to promote the consumption of seafood produced from the Mississippi Gulf Coast ecosystem.

(vi) Programs to promote education regarding the natural resources of the Mississippi Gulf Coast ecosystem.

(vii) Planning assistance in Mississippi.

(viii) Workforce development and job creation in Mississippi.

(ix) Improvements to or upon state parks located in Mississippi coastal areas affected by the Deepwater Horizon oil spill.

(x) Mitigation of the ecological and economic impact of outer Continental Shelf activities and the impacts of the Deepwater Horizon oil spill or promotion of the long-term ecological or economic recovery of the Mississippi Gulf Coast ecosystem through the funding of infrastructure projects.

(xi) Mississippi coastal flood protection and infrastructure directly affected by coastal wetland losses, beach erosion, and the impacts of the Deepwater Horizon oil spill.

(xii) Administrative costs of complying with this subsection (5).

(xiii) Sales tax and gaming tax revenues to the Mississippi State General Fund or restoration of sales tax, gaming tax and ad valorem tax revenues to local municipalities.

SECTION 4. Section 27-104-21, Mississippi Code of 1972, is amended as follows:

27-104-21. (1) All general and special fund agencies shall, upon making application for federal funds, forward a summary of such applications to the Legislative Budget Office. The Legislative Budget Office shall have an opportunity to review such applications and make its comments thereon to the Executive Director of the Department of Finance and Administration and the state agency making application. Unless otherwise specified in the appropriation bill, the Executive Director of the Department of Finance and Administration shall have the authority to approve escalations in a budget using one hundred percent (100%) federal money. The Executive Director of the Department of Finance and Administration shall only have the authority to approve escalations in a budget using federal funds received by the State of Mississippi under the federal Resources and Ecosystems Sustainability, Tourist Opportunities and Revived Economy of the Gulf Coast Act of 2011 (R.E.S.T.O.R.E.) pursuant to specific appropriation by the Legislature from the Mississippi Gulf Coast Restoration Fund as provided under this act.

(2) New employee positions funded one hundred percent (100%) by or from federal funds may be authorized by the Executive Director of the Department of Finance and Administration subject to the rules and regulations of the State Personnel Board. No federal funds may be expended for programs or activities other than those which have been authorized by act of the Legislature or which are encompassed by a state agency's program structure as provided by law. The Executive Director of the Department of Finance and Administration shall immediately send notice of the approval of such budget escalation to the Legislative Budget Office. The Executive Director of the Department of Finance and Administration shall ensure that the Legislative Budget Office receives timely, detailed and accurate information about the amount and use of federal funds by state agencies.

(3) The Department of Finance and Administration shall require, by rule and regulation, that each agency receiving federal funds shall apply for federal reimbursement for state central services costs in accordance with Office of Management and Budget Circular A-21 or A-87, which reimbursement shall be deposited directly into the Statewide Cost Allocation Fund, which is hereby established within the State Treasury. An agency's failure to timely apply for such reimbursement shall be condition sufficient to authorize the Department of Finance and Administration to transfer an amount equal to not less than fifty percent (50%) nor more than one hundred percent (100%) of the total amount designated to such agency in the applicable fixed cost agreement of the state central service cost allocation plan. These funds shall be transferred from any available funds within such agency into the Statewide Cost Allocation Fund upon execution of a requisition for issuance of warrant by the Executive Director of the Department of Finance and Administration. Any funds on hand in said Statewide Cost Allocation Fund at the end of the fiscal year shall lapse into the State General Fund.

SECTION 5. This act shall take effect and be in force from and after July 1, 2012.