The deal to close California's $26 billion budget deficit included a plan to drill for offshore oil, drawing allegations that the fiscal crisis was used for a backroom deal following rejection of the idea by state regulators earlier this year.
Democrats agreed to Republican Gov. Arnold Schwarzenegger's request to expand drilling from an existing platform off Santa Barbara to generate a one-time $100 million advance royalty payment this fiscal year and an estimated $1.8 billion in royalties over 14 years.
It would be the first new offshore oil drilling on state lands in four decades since a blowout on a platform off Santa Barbara coated miles of ocean and shoreline and galvanized opposition.
Details of the agreement reached late Monday were scarce, but Lt. Gov. John Garamendi, chairman of the State Lands Commission, said Tuesday that the framework involved taking authority for approval of oil leases away from State Lands and giving it to a newly created panel.
"This is a play by the governor to have it his way," he said. "This is a sellout to the oil industry. They want to open the California coast to drilling, and this is the first step."
The lack of details on the agreement and the way it emerged in budget talks concerned Victoria Rome, deputy California advocacy director for the Natural Resources Defense Council. "I think it should be very troubling to the public that a decision that was made through a public process in the light of day can be overturned by a few leaders behind closed doors," she said.
Schwarzenegger spokeswoman Lisa Page said the proposal would bring new revenues to the state, end oil drilling off Santa Barbara's coast and speed up the permanent removal of platforms there.
The governor's office said in a statement that the platform involved is already drilling in federal waters adjacent to state waters. It said the project maintains a moratorium on oil drilling "but takes advantage of a specific exemption that allows for new leases if oil is leaking from an existing state field into an actively producing federal field."