NEW ORLEANS (AP) - When BP PLC and its partners pay water pollution fines that could run to billions of dollars for the massive 2010 oil spill off the Louisiana coast, Congress says 80 percent of that money should be spent on ecosystem and economic restoration in five Gulf states.
The House and Senate included the provision in a transportation bill both chambers passed Friday. The bill - which would also result in Medicaid cuts in Louisiana - now goes to President Barack Obama.
BP could be fined between $5.4 billion to $21.1 billion under the Clean Water Act, depending on whether the company is found grossly negligent.
The British oil giant and its contractors were drilling an oil well when it blew out on April 20, 2010, killing 11 workers and spewing more than 200 million gallons of oil into the Gulf of Mexico.
Congressional members from the Gulf states were relieved by the bill's passage. They had worried that the hefty fines would have ended up going into a general fund unless they passed language specifying how the money was to be spent.
U.S. Sen. David Vitter, R-La., said setting aside the fines was "an absolute top priority."
Mississippi Gov. Phil Bryant called the bill "unprecedented" and said he would "make certain that Mississippi receives it share" of the money.
Environmental groups also applauded the bill's passage and called it an opportunity for billions of dollars to be spent on Gulf ecosystem projects.
In a joint statement, several environmental groups said the money would help restore the Gulf and create new jobs.
"This is a win-win for coastal communities along the delta," said the statement issued by the Coalition to Restore Coastal Louisiana, Environmental Defense Fund, Lake Pontchartrain Basin Foundation, Louisiana Wildlife Federation, National Audubon Society, National Wildlife Federation and The Nature Conservancy.
Aaron Viles, deputy director of the Gulf Restoration Network in New Orleans, urged the Gulf states to use the money wisely and "not fall prey to the pork-barrel politics of the past."
Passage of the transportation bill also carried some bad news for Louisiana.
Under the bill, more than $650 million in federal funding is stripped from Louisiana's Medicaid program over two years. The cut could shutter services and force deep reductions to spending on hospitals that care for the poor and uninsured in the fiscal year that begins July 1. It's estimated that $1.1 billion would have to be cut from the $7.7 billion Medicaid program in the coming fiscal year, when state and federal matching dollars are included in the calculation, to account for the change in the highway bill.
The cuts in the highway bill stem from a provision that U.S. Sen. Mary Landrieu, a Democrat, added to the federal health care overhaul law that was designed to buffer Louisiana from a Medicaid rate drop because of the influx of rebuilding dollars after hurricanes Katrina and Rita in 2005. An error in the writing of the provision has sent hundreds of millions more to Louisiana than what was initially expected.
Congressional Republicans pushed to find ways to offset some of the costs for the highway program, and Landrieu said the Medicaid cut was proposed by House leaders to help pay for the transportation bill.