There has been a great deal of federal-state conflict, termed the "Seaweed Rebellion," regarding the development of outer continental shelf (OCS) oil and gas resources. The crux of the conflict is that the benefits of OCS energy development are national, while the impacts are regional. One of the main issues of contention is the distribution and control of the revenues derived from OCS energy development. Presently, most of the revenues are deposited into the U.S. Treasury and utilized to pay for federal programs and deficit reduction. OCS revenues fund the Land and Water Conservation Fund Act, which provides grants to state governments for the planning, acquisition, and development of public outdoor recreation areas and activities, and the National Historic Preservation Act, which provides grants for historic preservation. The coastal states share only in the revenues derived from OCS energy development in the §8(g) zone, which extends three to six miles offshore.

There have been numerous unsuccessful efforts to share OCS revenues with the coastal states. In November 1999, the House Resources Committee approved the Conservation and Reinvestment Act of 1999 (CARA), which utilizes OCS revenues to fund numerous natural resource programs, including $1 billion for coastal state impact assistance and coastal conservation. CARA is likely to be passed in the second session of the 106th Congress. The sharing of OCS revenues will rectify the U.S. Supreme Court's tidelands decisions, provide funds to deal with the impacts of OCS energy development, address the inequity between coastal and inland states regarding the revenues derived from mineral development on federal lands, and strengthen the federal-state offshore partnership.