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Pelican Institute-R Street Report Calls for Careful Oversight of RESTORE Act

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Careful implementation vital as Louisiana cannot afford to see funds misused

Nearly four years after the Deepwater Horizon oil spill, it is crucial that conservatives engage as local authorities implement federal law passed to restore the environment and economies of Gulf Coast states, according to a new report jointly published by the R Street Institute and the Pelican Institute for Public Policy.

Passed in 2012, the Resources and Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the Gulf Coast States Act, or RESTORE Act, sets aside 80 percent of the civil and administrative fines paid pursuant to the 2010 spill. In their paper, Pelican Institute President Kevin Kane and R Street State Projects Director Daniel M. Rothschild argue the law’s statutory language is, in many cases, extremely vague, raising the possibility that funds could be spent in service of goals that fall far outside a free-market, limited-government framework.

“While the RESTORE Act is in many ways imperfect, it does reflect a number of important conservative principles,” Rothschild and Kane write. “These include privileging local decision-making over federal regulation, maintaining a direct nexus between the actors liable for the disaster and the people and firms adversely impacted, and a commitment to reducing future taxpayer exposure to risk.”

The scholars identify six key principles that should guide a conservative approach to RESTORE Act implementation:

  • Projects should aim to provide public goods or at least remedy market failures
  • Projects should have a direct and tangible connection to the areas impacted by the spill.
  • Projects undertaken under the rubric of “sustainability” should demonstrate specifically how they affect the incentives of households and firms or reduce future economic costs.
  • Projects that mitigate or ameliorate damage from previous poorly-executed government programs should be prioritized.
  • Projects should be justifiable on sound economic grounds, bearing in mind the opportunity cost of spending.
  • The decision making and implementation process should be completely transparent.

“Conservatives and good government activists who want to ensure that the funds are used responsibility should pay close attention to the actions by officials,” Kane and Rothschild write. “Louisiana faces real vulnerabilities and cannot afford to see funds misused on projects that do not advance the act’s goals. This opportunity to accomplish something good out of the BP disaster should not be squandered.”


To read the full report, visit: 

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