Taxpayers may be on the hook for hundreds of thousands of dollars if the Southeast Louisiana Flood Protection Authority-East has to withdraw its lawsuit against oil and gas companies.
SLFPA-E met opposition from the legislature’s Joint Transportation Committee Wednesday, as the committee gathered information from the authority on the suit, also hearing opposing testimony from Coastal Protection and Restoration Authority head Garret Graves.
According to the contract with SLFPA-E lawyers, if the authority loses the suit, the attorneys get no compensation for the case. If they win, they’ll get roughly 22 percent of the winnings. But if SLFPA-E pulls out of the lawsuit — and opposition to the suit from the state is mounting — the organization will owe the firm hundreds of thousands of dollars in already incurred lawyers’ fees.
“We filed suit because we don’t want more people to die in a hurricane,” SLFPA-E Vice President John Barry told the committee. “We don’t want their homes and livelihoods destroyed. We structured the contract the way we did for the same reason.”
The authority is suing over 90 oil and gas companies for negligence in their operation in the marshes near SLFPA-E’s jurisdiction, saying the companies failed to repair wetlands where canals were dredged to accommodate oil and gas production. The authority says those canals weakened the barrier New Orleans needs to defend against storm surge.
Sen. Robert Adley, chairman of the Joint Transportation Committee, says SLFPA-E did not do their due diligence before pressing the lawsuit. He criticized Barry for not getting approval from the state’s Attorney General (which Barry says the authority did) and not going to other state executive departments working to protect the coast (which Barry says they didn’t have to do).
The SLFPA-E says the oil and gas companies failed to fulfill promises to mitigate damage done to the coast. Adley says that’s not fair.
“What’s scary here is,” Adley said, “is that we set a precedent in this state that says that any business that wants to locate here, ‘come on in.’ We encourage you. We tell you to go do it. And when we run out of money, we’ll sue you to get some more.”
The committee created SLFPA-E in a special session after Hurricane Katrina to be a body independent of political influence. “The same kind of political influence we’ve faced since filing the suit,” Barry told the committee.
Gov. Jindal and Graves have both openly criticized the lawsuit. Members of the Flood Protection Authority are nominated by a board of specialists, then approved by the governor and the state senate.
Graves told the committee Wednesday that this lawsuit is outside the state’s unified effort to protect the coast — a massive $50 billion dollar “Master Plan” to rebuild marshes and protect coastal cities. The CPRA was also created after Katrina, to consolidate the state’s coastal restoration efforts.
“Everybody that’s sitting on this committee,” Adley said, “we know the problems with our coast. But rogue operations are not necessarily the best solution. [SLFPA-E] has filed a lawsuit asking for something that coastal management on the state level says is a terrible idea.”
Graves said the oil and gas industry doesn’t deserve to be targeted by the case, citing the industry’s 300,000 jobs, $80 billion in economic activity, and current contributions to restoration.
“I want to be clear,” Graves said, “I’m not saying anyone deserves a pass because of activity and jobs, but there are ways of approaching things like this. And there’s a bigger picture.”
Graves was quick to blame his favored scapegoat, the Army Corps of Engineers.
Rep. Karen St. Germain, who heads the House’s Transportation Committee, said she couldn’t see how the authority was stepping on the state’s toes.
“I want the committee to remember what we’re here for. [The meeting] is not about hurting any entity. It’s about protecting the state and the people,” St. Germain said. “Having someone else take a stand, or feel like they are helping [the Master Plan] is not the end of the world.”
SLFPA-E will gather for its scheduled monthly meeting Thursday. The lawsuit is among other topics of business that will be discussed. NOLA.com has reported that Graves has been invited but hasn’t confirmed attendance.