Governor's raids on Rigs to Reefs fund call program into question

Louisiana Governor Bobby Jindal has once more come under fire for raiding the state's Rigs to Reefs fund to keep his budget balanced, but the program's overseers are threatening a legal fight-back if he does it again.

Since 2010, Jindal has taken $45 million from the fund to cover budget overruns, according to reports.
Now the Wildlife and Fisheries Commission, which oversees the program, is reported to be considering a lawsuit to get the money back if any more is taken.

“It's in the Conservation Fund and the Conservation Fund is protected by the Constitution,” Ronny Graham, the commission board’s chairman, told local media.

The fund was set up to collect donations from oil companies when their offshore rigs come to the end of their useful lives.

The companies agree to hand over the old rigs to the Department of Wildlife and Fisheries, plus half the money they would have spent to remove them.

According to the rig donation agreement, the money is “to be placed in the Artificial Reef Fund for the benefit of the Louisiana Artificial Reef Development Program”.

The commission started considering legal action last year, when Ann Taylor was chairwoman. She said the rules are clear: The money is only supposed to go for building reefs and similar fisheries-related projects.

She told's Eyewitness News that if any more money is taken from the fund when Jindal proposes his 2013-2014 budget on 22 February, the commission should do “everything in its power” to protect the fund.

“I wish we could get [the $45 million] back but I don't know if that's going to happen,” she said. “I think that we're just going to watch and take the appropriate action if anything does happen” in the next budget.

In 2010, the Jindal administration took $18 million from the funds’ $44 million balance to cover general fund shortfalls. In the 2011-2012 fiscal year, it took $27 million to pay Medicaid expenses. As of 30 January this year, the fund had just $13 million in it.

But the Jindal administration is unrepentant.

“We're confident that the law has allowed for unused, excess dollars to be used to protect higher education and health care,” Kristy Nichols, Jindal’s commissioner of administration told Eyewitness News. “Any time we use statutory funds in this way, we ensure that the core mission of the fund is protected.”

Broad failure

For conservationist Steve Kolian, this latest controversy is just another sign of the broad failure of the Rigs to Reefs program.

He argues that under the program too many rigs are moved or toppled, which destroys the delicate marine habitat it is supposed to protect.

The rigs need to stay upright to preserve the corals that have taken years to accumulate, he says.

“When it goes into the Rigs to Reefs program they lose 90 per cent of the fish,” he told DecomWorld, “because when it goes through the whole water column the population of fish is ten times greater. If they topple it all those corals get reorientated in the water, and they die, so the Rigs to Reefs program is not a solution to all the habitat destruction that's occurring out there.”

He said the issue of liability for damage to fishing operations – torn nets, for example – is another sticking point.

He believes the state fund Gov. Jindal keeps raiding is actually there to provide a cushion for the operators who donated the rigs in case the blame for damage finds its way back to them.

But Kolian believes the disused platforms are so rich in potential other uses – commercial fishing, as bases for renewable energy, even for medicine, as the organisms are now thought to secrete compounds useful to drug companies in treating disease – that ownership and liability should be transferred to private companies.

On top of that, he believes the liability concern is, so to speak, a red herring: “Nobody ever in history – and you can quote me on this because I've been researching it – there's never been a claim against an artificial reef holder, whether it's a state or an individual, in the history of marine law in the United States,” he said.

Unlike the rigs, he says, Rigs to Reefs should be scrapped: “Oil and gas companies are really disenchanted with that program now. Fewer and fewer companies are participating.

“It's better than nothing, and that's about all it is: better than nothing. It'll never be successful.”