$700M in Louisiana roadwork to be paid with oil spill money

June 4, 2019 GMT

BATON ROUGE, La. (AP) — Louisiana lawmakers want to redirect nearly $700 million in Gulf oil spill recovery money that had been earmarked for trust funds to instead finance roadwork, bridge upgrades and port improvements.

The state is receiving yearly payments of $53.3 million through 2034 from BP PLC as compensation for economic damage from the massive 2010 oil spill. The payments are separate from recovery money slated for coastal restoration.

With a 90-11 House vote Tuesday, lawmakers gave final passage to a bill by Rep. Tanner Magee steering that money to infrastructure projects. The proposal goes next to the desk of Democratic Gov. John Bel Edwards for his review.


Under the bill, $150 million would pay for improvements to LA Highway 1 in Lafourche Parish, a highway that leads to the critical oil and gas hub of Port Fourchon. Another $125 million would fast-track an LA Highway 415 road project in West Baton Rouge Parish aimed at alleviating traffic snarls. Other dollars would go to Interstate 49 work.

“This will be the biggest investment in infrastructure in the state of Louisiana in probably 30 years,” said Magee, a Republican from Houma.

He said some of the projects will be matched with local, federal and private dollars, boosting the investment to $1 billion.

Under a 2014 law, the oil spill recovery money was earmarked to the state’s “rainy day” fund, an elderly trust fund and a health savings account that were drained during former Gov. Bobby Jindal’s tenure. Despite the law, the Legislature has several times diverted the economic damage money to pay for operating expenses.

Magee’s bill would send the $53 million annual payment to the trust funds for the upcoming budget year that starts July 1, but scrap those earmarks starting in the 2020-21 financial year.

Supporters said the state’s infrastructure needs outweigh the trust fund benefits, pointing to a nearly $14 billion backlog of road, bridge and other transportation work. Completing those projects, lawmakers said, would be a boost to economic development. They said they chose projects that they consider “shovel-ready” if they have the financing.

Also on the 10 project list, the bill would steer:

—$150 million to I-49 South.

—$50 million to LA Highway 3241 from Interstate 12 to Bush in St. Tammany Parish.

—$100 million to the I-49 North Inter-City Connector in Caddo Parish.


—$20 million to buy a new Cameron Parish ferry.

—$40 million to replace and rehabilitate bridges around the state.

—$19 million to the Sugar House Road extension project in Rapides Parish.

—$20 million to buy two cranes for the port of New Orleans.

—$15 million to the Hooper Road widening project in East Baton Rouge and St. Helena parishes.

Magee’s legislation authorizes the State Bond Commission to borrow the money to speed the projects, paying off the bond debt with the annual oil spill recovery money payment.

The economic damage dollars are separate from an estimated $5.8 billion Louisiana is expected to receive in other civil penalties from violations of environmental laws, money that’s required to be set aside for coastal restoration projects and environmental rehabilitation.


House Bill 578: www.legis.la.gov


Follow Melinda Deslatte on Twitter at http://twitter.com/melindadeslatte