ABSTRACT
The development of the Coastal Energy Impact Program in response to the national objective of removing disincentives for energy facility location provides several lessons for the design of federal grant and other intergovernmental programs. The new energy facilities associated with each of the energy sources may have major effects on land use and the social, economic, and natural environment in the coastal zone. Recognition of the potential for adverse impacts that would lead state and local governments to refuse the development of energy facilities in their areas has resulted in legislation designed to overcome the disincentive problem. State and local governments obtain their revenues from taxes and user charges from individuals and businesses, or from grants and contracts from other units of government. The problem that arises with offshore energy development is that the business tax portion of a state or local government’s revenue is not accessible because the development of the facility is beyond its taxing jurisdiction.
