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Santa Monica, Calif.

The subcommittee met at 9:50 a.m., in the Civic Center Conference Room, Santa Monica, Calif., Hon. John V. Tunney presiding.


Senator TUNNEY. Good morning, the committee will come to order. For the record, I am John Tunney and on my left is Senator Ted Stevens, of Alaska.

Senator Stevens, I would like to take this opportunity to welcome you to warm, sunny, southern California, and I am grateful to you for taking time out from your busy schedule to be here this morning. Through your cosponsorship of the Coastal Zone Management Act, your participation in the development of the deepwater port legislation, and your involvement in recent National Ocean Policy Study hearings in Washington on the coastal impacts of OCS development, you have gained considerable expertise concerning energy-related problems in the coastal zone. I am delighted to have the benefit of your experience as we talk about the California situation.

Senator Ernest F. Hollings, of South Carolina, who is chairman of the Senate National Ocean Policy Study, has asked me to express his regrets that he cannot be here today due to previous commitments in his home State. Senator Hollings was a principal cosponsor of the Coastal Zone Management Act and was instrumental in the creation of the National Ocean Policy Study. He has asked me to assure you of his very strong interest in the subject of these hearings, and has indicated that he expects the National Ocean Policy Study to move quickly to make recommendations and formulate legislation based upon what we learn here in Santa Monica. The National Ocean Policy Study should have its recommendations on this issue ready to go by the first day of the 94th Congress.

Today is the first of 2 days of hearings that the National Ocean Policy Study will conduct on the subject of the State role in offshore oil and gas development. In February of this year, the Senate of the United States felt compelled to reassess our entire national posture and policy relating to the oceans and particularly how the growing needs of our citizens would impact life in the coastal zone. Under the leadership Staff member assigned to these hearings: John F. Hussey.


of Senator Magnuson and Senator Hollings, Senate Resolution 222 passed the Senate by a unanimous vote. It provided for much needed comprehensive reassessment of ocean policy, and it brought into this review other Senators representing the Public Works Committee, the Committee on Interior and Insular Affairs, Committee on Foreign Relations, the Appropriations Committee, the Government Operations Committee, the Committee on Labor and Public Welfare, and the Committee on Armed Services, each of whom have major concerns over some aspect of national ocean policy.

Since its creation the study group has been hard at work. The economic, social, and environmental impacts of Outer Continental Shelf development have been among the first areas of investigation by the study. The former administration's decision to lease 10 million acres over the next 6 years is a good example of how national ocean and coastal zone policy is often precipitated by major policy decisions in other areas in this case energy policy. It can, I think, be properly described as ocean policymaking by default.

Outer Continental Shelf development off our coasts will have more of an impact on the ocean environment, the coastal economy, and growth and development in the coastal zone than any other single Federal action in the years to come. Yet the Federal Government has developed its leasing program in a vacuum, basing it almost entirely on an elusive quest for energy independence, while giving little consideration to the impact of such a program on other national goals and policies.

While this is the first hearing on the specific topic of State and local involvement in Federal decisionmaking, the National Ocean Policy Study held 6 days of hearings in Washington in April and May on the coastal impacts of OCS development, and an additional field hearing was held in Boston last month. In conjunction with these hearings, the Office of Technology Assessment and the Library of Congress have been assisting the staff in conducting studies and preparing reports on various aspects of OCS oil and gas development. The National Ocean Policy Study expects to make substantive recommendations next year in the form of legislation that will be aimed at solving some of the major conflicts in national policy with regard to offshore development. The issue of the timing and location of the proposed oil and gas leases off the southern California coast has been in the forefront of the public mind since the Department of the Interior first announced its intention to begin leasing sometime next year. As most of you are aware, the city of Los Angeles and virtually every other local government onshore from the drilling area have passed resolutions expressing concern over the speed at which the Department of the Interior has moved to begin leasing. Many have asked for a postponement of leasing until proper assurances can be made that the California coastline would not be damaged.

The California Coastal Commission, which has been involved in preparing a coastal zone management program for the State, passed a resolution in August which requested that

The Secretary of the Interior . . . defer issuing any new leases for oil and gas development on the submerged lands adjacent to the State of California until the Cailfornia Coastal Conservation Plan, or at least the applicable energy elements of the Plan, have been completed by the Regional and State Commissions or until the Federal Government's development plans for these lands

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have been otherwise adequately reviewed by and approved by the Coastal Commission and other appropriate agencies of the State of California.

When Interior refused to postpone the proposed lease sale, in accordance with the Commission's request, the Attorney General and the Commission filed suit in U.S. Federal district court asking that Interior be enjoined from going through with the sale until an environmental impact statement can be completed on Interior's comprehensive 10 million acre leasing program. It is argued, quite rightly I believe, that other alternatives to drilling in the southern California area should be properly examined before, and not after, the decision to lease these areas is made.

The State legislature has also spoken clearly on this issue. A joint resolution passed by both houses on April 18, 1974, notes, among other things, that "the State of California has no control or voice in the decisionmaking process for the leasing of offshore waters under Federal jurisdiction, even though the State has a primray interest in the safety, pollution prevention, economics, and esthetics of such operations." The legislature went on to ask the Congress and the President—

*** to support and adopt such laws and regulations as will permit the State of California to participate in all decision making relating to the leasing of federal submerged lands off the California coast for oil or gas production, including granting to California the right to recommend denial of any proposal which endangers the state's coastline or life or property in the state, constitutes an immediate or potential geologic hazard, or is environmentally incompatible on an aesthetics or total use basis ***

The State legislature also went on record as favoring compensation for California consisting of a portion of the oil and gas revenues in order to assist the State in coping with secondary economic and environmental impacts.

As Senator from California, I have been particularly concerned with the OCS development problem and have sought ways to improve the role of the State and local governments in the Federal decisionmaking process. My own position is that the Federal offshore leasing program should proceed only if it is consistent with California Coastline Commission policy and plans and is conducted with strict technological, environmental, and esthetic safeguards. Federal consistency with coastal zone management plans is clearly stated as a policy of the Federal Government in the National Coastal Zone Management Act of 1972. It is high time for the Department of the Interior to give proper consideration to the goals and policies of this Act in their dealing with State and local governments in matters of such importance as offshore oil and gas development.

There is no question that tapping the Nation's offshore oil reserves can significantly ease the fuel shortage. There is no question that it has an important place in Project Independence. But in doing so, we must be sure that we are not harming the marine and coastal environment. We simply cannot risk another oil spill disaster like Santa Barbara. This is precisely the reason why coastal zone management and the careful consideration of the timing and location of the drilling sites are so important. This is why the State of California and other affected States must be given a definite, substantive voice in the decision as to where drilling should and should not occur.

A number of bills have been introduced during this Congress, including one I sponsored, to increase environmental protection and

safety of offshore drilling while acknowledging the need for greater offshore oil production. It has been my hope that major new drilling operations, such as in the virgin areas off southern California, would be delayed until Congress has an opportunity to enact necessary legislation.

Last week the Senate adopted a bill that would amend the Outer Continental Shelf Lands Act of 1953 to provide greater environmental safeguards. During deliberations on the Senate floor the National Ocean Policy Study was successful in adding amendments to this bill which clearly establish a stronger role for State governments in negotiating with the Secretary of the Interior over disputes arising from oil and gas development on the Outer Continental Shelf. The most significant amendment-which I cosponsored with Senator Cranston and Senator Mathias of Maryland-granted the Governors of coastal States the right to ask for a postponement of the lease sale in the event he finds that adverse environmental or economic damage would occur. In the event the Department of the Interior should fail to grant the requested postponement, the decision would be sent before the National Coastal Resources Appeals Board for arbitration. The decision of the appeals board, which would include the Vice President, the head of the National Oceanic and Atmospheric Administration, the Administrator of the Environmental Protection Agency, and the Secretary of the Interior, would be final. This goes a long way toward elevating the States' voice in determining where and when drilling should occur.

The Ocean Policy Study also was successful in adding an amendment emphasizing that the protection of the coastal zone and its resources are equally important goals to the Nation and must be considered as a factor in future development of offshore areas.

Another key Ocean Policy Study amendment, adopted by a 73-18 role call vote, transferred a proposed $200 million coastal States fund away from the Department of the Interior into the Department of Commerce, the agency responsible for administering the Coastal Zone Management Act. It was the feeling of a majority of the Senate that an Interior-administered fund would place the Secretary in a position of conflict. Since he has responsibility to develop the OCS, he should not be able to unfairly influence States opposed to development by being able to grant them large sums of Federal aid to lessen their legitimate concerns. The fund can be more fairly allocated by the Department of Commerce to the best interest of affected coastal States, such as California.

While this bill, entitled the Energy Supply Act, has little chance of getting through Congress this year, it is certain to be one of the first orders of business next January, when the new Congress convenes. Between now and then, Chairman Hollings and the National Ocean Policy Study are goig to examine the procedures currently being employed by Interior to solicit State and local participation in decisionmaking, through hearings such as these, with the idea of establishing a definite, effective voice for the coastal States in these important matters. The amendments adopted last week are only the first step in this effort. Testimony we are about to receive at these hearings will be valuable in helping formulate this new State role.

Today and tomorrow we are going to air three questions of interest to the study group: First, we want to know what the State role is, and what it should be, regarding development of offshore oil and gas resources. Secondly, we want to know what role coastal zone management should play in the timing and siting of drilling sites and onshore support facilities. And, finally, we want to examine the leasing program now being followed by the Interior Department, and the national energy policy being developed by the Federal Energy Administration to ascertain the reason why the Federal Government has chosen this particular time for developing the southern California leasing area. I understand that there has been some conflicting statements between Interior and FEA over the degree of flexibility that can be afforded with regard to postponing the lease sale. I think this should be cleared up so that we will know what the current policy of the Federal Government in this matter actually is.

Senator Stevens?

Senator STEVENS. I am happy to be here with you, Senator Tunney. Alaskans are quite interested in the subject, and would like to point out that 65 percent of the Outer Continental Shelf is off Alaska and half the coastline of the United States is Alaskan. We are vitally interested in cooperation between State, local, and Federal agencies and I will be interested in hearing the testimony here today.

Senator TUNNEY. Our first witnesses are going to appear as a panel: Hon. Roy Holm, mayor, city of Laguna Beach; Pieter Van Den Steenhoven, councilman, city of Santa Monica; Pat Russell, councilwoman, city of Los Angeles; Lois Seidenberg, representative of the city of Santa Barbara; Milan Dostel, mayor pro tem, Newport Beach. Could you step forward to the witness table?


Mr. HOLM. Thank you, Mr. Tunney. We are very appreciative that this committee, which played such a fundamental role in the enactment of the Federal Coastal Management Act, is holding these hearings in southern California. We are most anxious that our Outer Continental Shelf be viewed as something other than a repository of oil and gas. It is a unique place on this planet and we believe its use and destiny should be determined by people who have the latitude to consider a variety of options and alternatives.

We have been asked to focus our remarks on (1) the State's role in Federal decisionmaking, and, (2) the timing of the proposed leases, and I shall do so.

First, the question of State participation in these decisions which will ultimately be decided at the Federal level, either by the administration, by legislation, or in the courts. The impact on the State by a decision made at the Federal level can be understood by examining

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