678 



Mr. Bumpers. I have one question to either manager of the bill. It 

 is with regard to the first funds. As I understand, the bill says $50 

 million and it is my understanding that that is an error. It should 

 be $100 million. 



Mv. Stevens. It was $50 million in the first one and $250 million in 

 the second one. It was changed by the Senator and myself to $100 

 million in the first and second. The total exposure of $300 million is 

 still there. 



Mr. Bumpers. The first $100 million, the first part of the aid, while 

 it does not tax offshore production, it does relate the amount of money 

 that goes into the fund to the number of barrels of oil and cubic feet 

 of gas actually produced offshore, is that correct ? 



Mr. Stevens. As I say, it is not a fund but it is a measurement for a 

 guaranteed grant. It is still subject to the appropriate process but pri- 

 marily used to finance those developments that have taken place prior 

 to production. That is an automatic grant concept that is based on 

 cents per barrel of production, later production. The other grant con- 

 cept, grant in loan, is in the area the Senator has been addressing in the 

 more discretionary area of planning to meet total coastal zone prob- 

 lems related to energy siting, energy development, and energy 

 production. 



]VIr. Bumpers. The second question : The State of Alaska, of course, 

 is a major producer and certainly will be a major supplier to the lower 

 48 when the pipeline is finished. Most of this oil will be landed in 

 the State of California. Will the State of Alaska and tKe State of 

 California share on the basis of the number of barrels produced and 

 landed in California ? 



Mr, Stevens. If the oil is produced offshore in Alaska and landed 

 in California, yes. 



Mr. Bumpers. Alaska will be entitled to certain sums of money based 

 on their production and based on the number of barrels landed, com- 

 pletely aside from any impact that may be measurable ; is that correct ? 



Mr. Stevens. No, that is not so. This money will be used to repay 

 bonds guaranteed by the Secretary of Commerce or to finance impacts 

 that have been outlined in the plan. To the extent that the moneys are 

 not used for that, they would revert to the Treasury. That is carried out 

 in the amendments that the Senator from Louisiana and I have offered. 

 The funds would revert to the Treasury unless they were used to meet 

 adverse impacts from OCS developments on shore. 



Mr. Johnston. Will the Senator yield at that point ? 



Mr. Ste\t.ns. Yes. 



Mr. Johnston. With respect to the first part, the $100 million fund, 

 the measure of what a State gets is the oil produced and landed in that 

 State, which gives them full credit ; or the oil landed, whicli gives half 

 credit, if not produced there ; or the oil produced and not landed gets 

 half credit as well. In other words, it is full credit for produced and 

 landed and half credit for either produced or landed. 



Mr. Bu3Ipers. And that is a fixed amount per barrel; is that 

 correct ? 



Mr. Johnston. A fixed amount per barrel or natural gas equiva- 

 lency. That is entitlement to receive it. But the uses are also spelled out 

 and must be related to tliese impacts subject to the Secretary of Com- 

 merce. The uses are in three categories in this priority: First, to pay 



