Over the past year, we have met with Governor Atiyeh and have briefed the Oregon State Sea Grant Advisory Council and the Governor's Advisory Committee on Maritime Affairs on the concept. In June 1981, just a year ago, we discussed this issue with Senator Hatfield and received his general support. Subsequently, we have met with our congressional delegation or their staffs twice in Washington, D.C.

Senator Packwood, at this time I would like to offer to you the association's sincere appreciation of your efforts, and of the efforts of others, to provide this opportunity for an indepth review of the merits of an Outer Continental Shelf receipts sharing concept. The introduction of this bill indicates to us your awareness and sensitivity to the special needs and concerns of our coastal area, and we would ask that you please accept our thanks.

The CHAIRMAN. Thank you.

Mr. RUTHERFORD. Now, why Outer Continental Shelf receipts sharing? Well, it is logical and it is necessary; logical and necessary to meet the natural and economic needs of our coast with a very small percentage of the funds received by the Federal Government from the exploitation of our offshore nonrenewable resources. Logical, not only because the State's coastal zone and Outer Continental Shelf are interrelated, but also because of our history of sharing mineral and other receipts with the States; and necessary if plans for the restoration, enhancement, and appropriate redevelopment are ever to be more than just plans.

Also, local governments are now limited, more than ever, in their resources. Justifiable needs at the State and local level are enormous, whether in fisheries, port redevelopment, impact assistance to local communities, expanding recreational opportunities, or other areas where these funds might be used.

How does S. 2792 assist in meeting some of these real needs? First of all, as it is presently written it allows Oregon a meaningful share of the national receipts. Of course, you have heard comments in regard to that. I would have to say that we agree generally with the comments that have been presented to you as to the cap, on the maximum any one State can receive.

It provides for a passthrough to local governments, which is extremely helpful in order to assure that Oregon's rather small local governments have an opportunity to access those funds. For this State in particular, local government is where most of the negative aspects of Outer Continental Shelf development will be found. The cost of meeting these aspects require greater economic assets than local governments have, or for that matter the State has.

This bill contains a relatively simple formula for determining shared funds to insure some reliability for local government in attempting to estimate receipts. As you have stated repeatedly, Senator Packwood, we think that is very important.

It allows maximum deference to the State and local governments in the use of those funds. Fisheries research and management, impact mitigation and assistance, coastal zone management and implementations, sea grant program activities, and capital infrastructure are sufficient direction in the type of uses which might be appropriate, depending upon the specific need or mandate of the agency or local government.

Complicated percentages in reporting are avoided, and more productive uses are possible with less bureaucracy.

We address S. 2792 because we believe all of the focus of needs in S. 2794 are met in a more practical manner in S. 2792. We fully realize the probable administration hostility toward dedicating Federal funds in the future, especially with the present difficulties in getting a handle on Federal spending and our Federal deficit. However, the needs are very real. They are very necessary and they are closely connected with the source of those funds.

Also, New Federalism implies assisting State and local government in playing a greater role, and this bill provides a mechanism for this State and its local coastal governments.

Third, we believe that this offers for you and for us an opportunity to work in concert, or as a partnership, if you will, in providing those improvements, enhancements, restorations that we need and that you want.

We can do it on a local level, but we have to have the funds to make our plans more than just plans, to realize those dreams. I think, as was indicated by Bruce Laird in his testimony, it would be impossible for the local communities to bear the cost of that alone.

In the waning days of the 97th Congress, Senator Packwood, we strongly urge your support of the concepts outlined in this bill. We have no illusions. We understand the uphill road it still needs to traverse. However, a year and a half ago this association was nearly alone in talking about this concept. It has come far. It has obstacles yet before it, but it has merit, and hopefully will enjoy your support.

Senator Packwood, we feel that your support is absolutely necessary for any chance of a constructive bill this Congress.

Thank you. I would be glad to answer any questions.
The CHAIRMAN. I have no questions, Mr. Commissioner.

You are right about the organization that was the lead in pushing this and first suggesting it. It is a brilliant capital idea and I appreciate the initiative that you gave to it and getting us started on it.

Mr. RUTHERFORD. Well, we really appreciate the cooperation that we have had from both-especially from your office, and from Senator Hatfield's office, too, and we thank you very much for that. The CHAIRMAN. Thank you

[The statement follows:]

STATEMENT OF HAROLD RUTHERFORD, REPRESENTING THE OREGON COASTAL ZONE MANAGEMENT ASSOCIATION, INC.

My name is Harold Rutherford, Lane County Commissioner and representing in testimony today the Oregon Coastal Zone Management Association, Inc. (OCZMĂ). I am currently the Chairman of the Association. OCZMA is a voluntary association of all seven Oregon coastal counties, nearly all of its coastal ports, all coastal soil and water conservation districts and many coastal cities. Presently 26 local units of government—all of which have a vital interest in the wise utilization of the coastal resources comprise the Association in an attempt to provide a unified voice.

Mr. Chairman, despite differing views and many frustrating setbacks, the Oregon coast has long supported a coordinated program for the the proper management of our coastal resources and in a balance of their uses. Your are undoubtedly aware of the existence of the Oregon Coastal Conservation and Development Commission between 1971 and 1975 before its functions were assumed by the Oregon Department

of Land Conservation and Development with the adoption of the four coastal goals (estuarine resources, coastal shorelands, beaches and dunes, and ocean resources). The impetus of that Commission's creation was from local officials. In a sense, then, Oregon's coastal jurisdictions interest in the management of our coastal zone predates both the state and federal efforts.

Thus, it is as a local coastal elected official representing all the local officials. In a sense, then, Oregon's coastal jurisdictions interest in the management of our coastal zone pre-dates both the state and federal efforts.

Thus, it is as a local coastal elected official representing all the local officials making up OCZMA that I make these comments today. They are reflective of our vital interest in the receipts sharing concept that goes back at least to March of 1981 when we testified during an oversight hearing on continuation of funding to states and local governments under Section 306 of the Coastal Zone Management Act. In supporting termination of Section 306 funding, we raised the issue of receipts sharing:

"The Association is convinced, however, that termination of Section 306 funding does not eliminate federal, state or local coastal management interest or need. Clearly, it was the intent of the original legislation and subsequent amendments and reauthorization that the coastal zone would be protected, enhanced and developed where appropriate for all the people of the nation. This implies that all of the people of the nation should have some share in implementation costs.

"Therefore, the Association supports termination of 306 and 308 mindful of the importance to-date of federal funding to this state and its local coastal jurisdictions. In this regard, the Assoication proposes that Congress and the President give serious consideration to offsetting federal funding reductions to the states and to local coastal governments by direct revenue sharing from a reported $9.9 billion oil and gas revenue annually generated and paid to the federal government from offshore lease activities.

"Funding would be tied to Outer Continental Shelf productivity with a guaranteed minimum percentage distribution to each coastal state to ensure equity and ongoing coastal zone management. Such funds could be used by local jurisdictions to their best advantage in continued coastal planning and would allow jurisdictions to implement their plans with the absolute minimum in multi-level bureaucracy and regulation. Additionally, these funds could be used for the enhancement of our coastal resources-including salmon and sea-going trout enhancement projects (habitat creation and/or other resource protection and enhancement possibilities— and for direct action programs for the needed redevelopment of coastal marinas, wharves and other vital port facilities.

"Therefore, in keeping with our belief that it was not the intent of Congress to place entirely the burden of implementing coastal zone management on local jurisdictions alone, that coastal zone management for the preservation, restoration, enhancement and appropriate development of our coast remains a viable concept, that coastal zone management in Oregon will severely affect local coastal governments, we accept the necessity of federal budgetary reductions at this time and perceive this necessity as an opportunity for a more creative, realistic and productive localstate-federal relationship in the proper management of our splendid and vital coastal resources."

We believe OCS receipts sharing provides this opportunity for a more productive relationship.

Over the past year, we have met with Governor Atiyeh (last October) and briefed the Oregon State Sea Grant Advisory Council and Governor's Advisory Committee on Maritime Affairs of the concept. In June of 1981, we discussed the issue with Senator Hatfield and received his general support. Subsequently we have met with our congressional delegation or their staffs twice in Washington, D.C.

Mr. Chairman, first let me offer the Association's sincere appreciation for your efforts and the efforts of others to provide this opportunity for an in depth review of the merits of an outer continental shelf receipts sharing concept. The introduction of this bill indicates your awareness of and sensitivity to the special needs and concerns of our coastal areas. Please accept our thanks.

S. 2792 as introduced provides an excellent vehicle for continuing the efforts of so many years in planning for the nation's coastal zone. We feel that it would be tragic if assistance in some form is not provided to ensure that all the planning actually results in something more than maintenance of the status quo. The needs of the Oregon coast to expand its efforts in fishery and habitat restoration and enhancement, particularly of our depressed anadromous fisheries, the need for port redevelopment, for hazard avoidance in development, for recreational opportunities for citizens of the entire nation and for many other purposes are staggering. It makes

enormous sense to earmark some of our funds from outer continental shelf development for assisting in the revitalization of our coastal natural and economic re

sources.

In other words, this bill provides an opportunity to turn planning and dreams into reality by providing federal assistance so absolutely critical at this time and to provide that aid to the levels of government where action can most effectively and efficiently be accomplished. Without some assistance from the federal government, many plans for restoration, enhancement and appropriate development will remain, at best, merely plans and a testimony in the future of what might have been. Concerning S. 2792 itself, the Association respectfully makes the following brief observations:

1. We are impressed with the recognition of the role of local governments in the stipulated pass-through of at least forty percent of the funds offered to any state or territory. Local governments can and should play a major role in helping achieve positive and constructive results in our coastal areas. This Association is committed to working with this Congress, the President and our state in support of this extremely valuable aspect of the bill.

Early House attempts this year at an OCS receipts sharing bill did not initially include an appropriate role for local governments. Since some state coastal management programs rely heavily upon local governments for implementation and since local governments-particularly ports-are where the development aspects of coastal zone management are found and where the negative impacts of OCS development will be felt, local government inclusion in a meaningful way is necessary to make the program successful and to broaden the base for management of our coastal zone. We strongly support maintenance of local governments role-and its support through dedicated funding. We know that there exists the belief by some that management of our coastal and ocean resources can be accomplished only by the federal government and that states and local governments are too close to the daily issues to allot funds properly. On the contrary, we believe states and local governments can do an excellent job with some federal financial assistance. We hope this Committee shares this view and supports dedicating funds to local governments.

Lastly, the bill's language should include ports and other special districts as well as counties and cities as potential recipients. However, only local governments located in the state's statutory coastal zone should qualify for inclusion in the receipts sharing program. Similarly, funds available to the state should be required to be used in the coastal zone or for activities directly affecting the coast.

2. The Association also agrees with the thrust of the bill in providing greater discretion to coastal states and local governments in the uses of those funds. The bill recognizes that we need results not percentages of funds spent to met grant requirements. In the past we have been critical of the inordinate amount of restrictions, conditions and application procedures of previous coastal zone management and Coastal Energy Impact programs. Tangible results in meeting the intent of the bill requires flexibility in the uses of the funds and an absolute minimum of multilevel bureaucracy in their allocation.

However, the bill should reflect more the developmental side of coastal zone management. As written, it is largely silent on development. For years, Oregon and most other coastal states have concentrated on planning at various levels of government and on the protection of coastal resources. While those are important goals unless they are accompanied with other goals they have a tendency to lock in the status quo.

The "national goals" of coastal zone management also call for the redevelopment of deteriorating urban waterfronts and port facilities. For a variety of reasons, ports have not been actively involved in Oregon's program yet certainly the emphasis in the act is on ports and urban waterfront redevelopment as well as on energy efficient transportation, increased recreational uses and access and on fisheries development. Coastal ports, cities and counties in Oregon could productively use the above mentioned development as partially funded through OCS receipts sharing.

In this regard, we would suggest that Section 6(g) be broadened to focus on capital infrastructure and other appropriate uses since one of the major needs of local governments is assistance in providing basic services. Many of the uses specified in Section 6(d) are more oriented toward state functions, except for Subsection d(5) which narrowly focuses on the relationship with energy development. Development examples include economic and engineering feasibility studies for port development, identifying future development land needs, land acquisition, marina efficiency improvement, dredge material disposal, incentives for rail system enhancement and many other possibilities. Millions of dollars have been spent in Oregon for planning and conservation; it would appear that equity and our sagging economy necessitate in

creased emphasis on the most logical centers of activity-and often the most needful of financial assistance-local governments.

As in the case of port and waterfront redevelopment, the "national goals" also speak to restoration and enhancement of coastal resources. In Oregon, the resource restoration and enhancement possibilities are legion, often very costly and seldom accomplished. OCS receipts sharing might allow for contributions to the state's Salmon and Trout Enhance Program (STEP), mitigation assistance, estuarine restoration measures, marsh restoration and creation and for many other activities.

In short, allowing flexibility to states and local governments provides an opportunity for meaningful completion of all the "national goals" of coastal zone management and for the provision of a balance of uses in our coastal zone.

3. The bill recognizes the intent of Congress that the proper management of the nation's coastal zone is in the national interest of the United States and in the interest of all the citizens of the nation-not entirely those residing in the coastal zone. Therefore, we support the sharing of the off-shore receipts with all states and territories and not with just those areas, which, at this time, have oil and gas activities off their coastline. Someday, should offshore ocean mining of minerals develop, an equitable sharing may also be necessary since those minerals may not be equally available off-shore of every coastal state or territory.

4. Likewise, we support additional allocation to those states and territories with approved coastal management programs. As you are aware, Oregon's program is the second in the nation to be approved. Thus funding recognizes the effort of the states and local governments in establishing a coastal management program and also the need to keep those programs viable.

Again, local governments have expended considerable resources to date under this program and some funding recognition appears warranted.

5. We do have some concerns that the bill language regarding the allocation of those dedicated funds to local governments may need revision to allow for greater discretion within the state and by the local jurisdictions on how the funds might be allocated and the uses allowed. We are concerned that coastal population, shoreline mileage and energy considerations are not precisely related to the larger coastal needs of local governments in the State of Oregon. We would welcome an opportunity to work with your Committee staff on this issue.

Fully conscious of the tremendous needs at the local level and the very logical connection between the exploitation of our offshore nonrenewable resources and the restoration, enhancement and development of our coastal areas, we strongly support S. 2792 with minor changes. On behalf of the 26 units of local governments making up this Association, we urge your active support for this bill this session.

Mr. Chairman, we appreciate this opportunity to appear before you and on behalf of all the local governments on the Oregon coast extend a warm welcome on your upcoming field hearings on our great coast. I can assure you of our continuing commitment in attempting to meet that elusive balance of uses in our coastal zone.

The CHAIRMAN. Next we will take Bill Wick, the director of the sea grant program at Oregon State, formerly the director of the Marine Science Center, and a man who has been more connected with sea grant and marine education than I think almost anybody in the country.

STATEMENT OF WILLIAM Q. WICK, DIRECTOR, SEA GRANT PROGRAM, OREGON STATE UNIVERSITY, CORVALLIS, OREG. Mr. WICK. Thank you, Mr. Chairman, Senator Packwood. I am pleased to have the opportunity to be here today with you.

Like others, I would like to thank you for long-term support, this time of the sea grant college program, both on the national level and also on the State level.

You may recall that in the 1967 State Legislature of Oregon the first State support for sea grant came. From among all the 50 States State support began in Oregon. This helped us to become the first sea grant program in the country in 1968, and eventually the first sea grant college in 1971. We really appreciate your long-term continuing help.