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BESE
8(g) History
The Louisiana Education Quality Trust Fund - A History
In the mid-1900s, major oil and gas deposits discovered in the outer continental shelf lands were the source of controversy between the federal government and the eastern coastal states. Louisiana first began drilling offshore in 1947, and the federal government immediately challenged the state’s claim to the area. It was generally acknowledged that the first three miles of the continental shelf, a shallow, flat portion of the continent that is underwater, belongs to the state, while the rest of the shelf is federally owned. It was the first three miles of the federal portion that was involved in the controversy.
As a result of this conflict, the 1953 Outer Continental Shelf Lands Act was passed to regulate offshore leasing and to determine state/federal participation. After major oil and gas discoveries were made off the coast of New Jersey in 1978, the east coast states, in an effort to protect their resort and fishing industries, led a successful fight to reform the 1953 act. As a result, states gained more control over offshore activities through an amendment to the original act.
The amendment, numbered 8(g), is what gives coastal states a "fair and equitable” share of the money made from offshore development. A final settlement was reached in 1986, which gives Louisiana 27 percent of the money made from the 8(g) area of the continental shelf. With the state’s portion of the 8(g) resources, Louisiana voters chose to establish a trust fund for education, the Louisiana Education Quality Trust Fund, through a state constitutional amendment which allows the interest of the trust fund, also known as the Louisiana Quality Education Support Fund, to be spent for education purposes.
Since its inception in 1986, the BESE 8(g) Grant Program has allocated over $490 million. The fund has grown from $8,200,000 in its first year of operation to approximately $30 million annually, funding over 5300 projects. Thus far, BESE has allocated over $62 million for preschool programs, over $34 million for the certification of teachers, over $21 million for statewide distance learning, over $31 million for the purchase of superior textbooks, and over $18 million for the state-required testing program.
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LEQTF Timeline
•1978
–A U.S. Constitutional Amendment to the federal Outer Continental Shelf Lands Act, number 8(g), was included on behalf Louisiana and 6 other coastal states.
–Each state received a "fair and equitable” share of mineral revenues from the act. Litigation occurred over the definition of "fair and equitable.”
•1986
–Louisiana received an initial payment of $540 million in October of 1986.
–Deferred payments, totaling $84 million, were designated to be paid over the next 15 years.
–Ongoing payments of $5-15 million yearly were to be paid for current oil and gas production.
–The voters of Louisiana dedicated 8(g) funds for education.
–The Louisiana State Office of the Treasurer set up an education trust fund for 8(g).
•1990
–Constitutional amendment restricted administrative costs, clarified the oversight role of the Legislature, and strengthened the clause on supplanting.
•1994
–Constitutional amendment broadened the investment authority of the State Treasury.
•1995
–Consent judgment 90-880-A restricted certain expenditures for pervasively sectarian entities.
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