The property tax is the primary method of paying for municipal 

 services. The A.D. Little calculations show that municipal costs 

 are likely to exceed the property tax revenue generated from OCS ac- 

 tivity. The study noted that there is a great deal of uncertainty in 

 New England over whether OCS-related industries are taxable either as 

 real estate or personal property. It quoted an article from the 

 Providence Journal which stated that: 



Whatever other benefits an oil refinery might bring to 

 Rhode Island, the Governor's newly enacted economic 

 development program has taken away most of the impact 



it could have on local revenues. . .Under the state's re- 

 vised taxing structure. . .only a small fraction of this 

 investment will be taxable. " 



The situation is similar elsewhere. It would appear advantageous, 

 therefore, for the New England states to reconsider their tax structures, 



In 1976 Congress approved an energy impact amendment to the 1972 

 Coastal Zone Management Act. The Coastal Energy Impact Fund (CEIP) 

 was established to mitigate the problems communities face in 

 providing front end monies for public services prior to receipt of 

 taxes from OCS-related facilities. It provides loans to finance public 

 services, planning grants and monies to mitigate unavoidable losses. 

 The formula for allocation of the money is based on several criteria 

 including a previous sale, previous OCS employment and adjacency of 

 offshore drilling activity to the state. 



4.4 Economic Costs of Environmental Disruptions 



Adverse environmental impacts of offshore oil development are es- 

 pecially threatening to tourism and commercial fishing, which are de- 

 pendent upon a clean and productive coast. Marine organisms, coastal 



34 



