SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Offshore Fairness Act of 2005''.

SEC. 2. PURPOSES.

    The purposes of this Act are--
            (1) to provide equity to the States of Louisiana, 
        Mississippi, and Alabama with respect to the seaward boundaries 
        of the States in the Gulf of Mexico by extending the seaward 
        boundaries from 3 geographical miles to 3 marine leagues if the 
        State meets certain conditions not later than 5 years after the 
        date of enactment of this Act;
            (2) to convey to the States of Louisiana, Mississippi, and 
        Alabama the interest of the United States in the submerged land 
        of the outer Continental Shelf that is located in the extended 
        seaward boundaries of the States;
            (3) to provide that any mineral leases, easements, rights-
        of-use, and rights-of-way issued by the Secretary of the 
        Interior with respect to the submerged land to be conveyed 
        shall remain in full force and effect; and
            (4) in conveying the submerged land, to ensure that the 
        rights of lessees, operators, and holders of easements, rights-
        of-use, and rights-of-way on the submerged land are protected.

SEC. 3. SEAWARD BOUNDARY EXTENSION.

    (a) In General.--Title II of the Submerged Lands Act (43 U.S.C. 
1311 et seq.) is amended--
            (1) by redesignating section 11 as section 12; and
            (2) by inserting after section 10 the following:

``SEC. 11. EXTENSION OF SEAWARD BOUNDARIES OF THE STATES OF LOUISIANA, 
              MISSISSIPPI, AND ALABAMA.

    ``(a) Definitions.--In this section:
            ``(1) Existing interest.--The term `existing interest' 
        means any lease, easement, right-of-use, or right-of-way on, or 
        for any natural resource or minerals underlying, the expanded 
        submerged land that is existence on the date of the conveyance 
        of the expanded submerged land to the State under subsection 
        (b)(1).
            ``(2) Expanded seaward boundary.--The term `expanded 
        seaward boundary' means the seaward boundary of the State that 
        is 3 marine leagues seaward of the coast line of the State as 
        of the day before the date of enactment of this section.
            ``(3) Expanded submerged land.--The term `expanded 
        submerged land' means the area of the outer Continental Shelf 
        that is located between 3 geographical miles and 3 marine 
        leagues seaward of the coast line of the State as of the day 
        before the date of enactment of this section.
            ``(4) Interest owner.--The term `interest owner' means any 
        person that owns or holds an existing interest in the expanded 
        submerged land or portion of an existing interest in the 
        expanded submerged land.
            ``(5) Secretary.--The term `Secretary' means the Secretary 
        of the Interior.
            ``(6) State.--The term `State' means each of the States of 
        Louisiana, Mississippi, and Alabama.
    ``(b) Conveyance of Expanded Submerged Land.--
            ``(1) In general.--If a State demonstrates to the 
        satisfaction of the Secretary that the conditions described in 
        paragraph (2) will be met, the Secretary shall, subject to 
        valid existing rights and subsection (c), convey to the State 
        the interest of the United States in the expanded submerged 
        land of the State.
            ``(2) Conditions.--A conveyance under paragraph (1) shall 
        be subject to the condition that--
                    ``(A) on conveyance of the interest of the United 
                States in the expanded submerged land to the State 
                under paragraph (1)--
                            ``(i) the Governor of the State (or a 
                        delegate of the Governor) shall exercise the 
                        powers and duties of the Secretary under the 
                        terms of any existing interest, subject to the 
                        requirement that the State and the officers of 
                        the State may not exercise the powers to impose 
                        any burden or requirement on any interest owner 
                        that is more onerous or strict than the burdens 
                        or requirements imposed under applicable 
                        Federal law (including regulations) on owners 
                        or holders of the same type of lease, easement, 
                        right-of-use, or right-of-way on the outer 
                        Continental Shelf seaward of the expanded 
                        submerged land; and
                            ``(ii) the State shall not impose any 
                        administrative or judicial penalty or sanction 
                        on any interest owner that is more severe than 
                        the penalty or sanction under Federal law 
                        (including regulations) applicable to owners or 
                        holders of leases, easements, rights-of-use, or 
                        rights-or-way on the outer Continental Shelf 
                        seaward of the expanded submerged lands for the 
                        same act, omission, or violation;
                    ``(B) not later than 5 years after the date of 
                enactment of this section--
                            ``(i) the State shall enact laws or 
                        promulgate regulations with respect to the 
                        environmental protection, safety, and 
                        operations of any platform pipeline in 
                        existence on the date of conveyance to the 
                        State under paragraph (1) that is affixed to or 
                        above the expanded submerged land that impose 
                        the same requirements as Federal law (including 
                        regulations) applicable to a platform pipeline 
                        on the outer Continental Shelf seaward of the 
                        expanded submerged land; and
                            ``(ii) the State shall enact laws or 
                        promulgate regulations for determining the 
                        value of oil, gas, or other mineral production 
                        from existing interests for royalty purposes 
                        that establish the same requirements as the 
                        requirements under Federal law (including 
                        regulations) applicable to Federal leases for 
                        the same minerals on the outer Continental 
                        Shelf seaward of the expanded submerged land; 
                        and
                    ``(C) the State laws and regulations enacted or 
                promulgated under subparagraph (B) shall provide that 
                if Federal law (including regulations) applicable to 
                leases, easements, rights-of-use, or rights-of-way on 
                the outer Continental Shelf seaward of the expanded 
                submerged land are modified after the date on which the 
                State laws and regulations are enacted or promulgated, 
                the State laws and regulations applicable to existing 
                interests will be modified to reflect the change in 
                Federal laws (including regulations).
    ``(c) Exceptions.--
            ``(1) Mineral lease or unit divided.--
                    ``(A) In general.--If any existing Federal oil and 
                gas or other mineral lease or unit would be divided by 
                the expanded seaward boundary of a State, the interest 
                of the United States in the leased minerals underlying 
                the portion of the lease or unit that lies within the 
                expanded submerged boundary shall not considered to be 
                conveyed to the State until the date on which the lease 
                or unit expires or is relinquished by the United 
                States.
                    ``(B) Applicability for other purposes.--
                Notwithstanding subparagraph (A), the expanded seaward 
                boundary of a State shall be the seaward boundary of 
                the State for all other purposes, including the 
                distribution of revenues under section 8(g)(2) of the 
                Outer Continental Shelf Lands Act (43 U.S.C. 
                1337(g)(2)).
            ``(2) Laws and regulations not sufficient.--If the 
        Secretary determines that any law or regulation enacted or 
        promulgated by a State under subparagraph (B) of subsection 
        (b)(2) does not meet the requirements of that subparagraph, the 
        Secretary shall not convey the expanded submerged land to the 
        State.
    ``(d) Interest Issued or Granted by the State.--This section does 
not apply to any interest in the expanded submerged land that a State 
issues or grants after the date of conveyance of the expanded submerged 
land to the State under subsection (b)(1).
    ``(e) Liability.--
            ``(1) In general.--By accepting conveyance of the expanded 
        submerged land, the State agrees to indemnify the United States 
        for any liability to any interest owner for the taking of any 
        property interest or breach of contract from--
                    ``(A) the conveyance of the expanded submerged land 
                to the State; or
                    ``(B) the State's administration of any existing 
                interest under subsection (b)(2)(A)(i).
            ``(2) Deduction from oil and gas leasing revenues.--The 
        Secretary may deduct from the amounts otherwise payable to the 
        State under section 8(g)(2) of the Outer Continental Shelf 
        Lands Act (43 U.S.C. 1337(g)(2)) the amount of any final 
        nonappealable judgment for a taking or breach of contract 
        described in paragraph (1).''.
    (b) Conforming Amendment.--Section 2(b) of the Submerged Lands Act 
(43 U.S.C. 1301(b)) is amended by striking ``section 4 hereof'' and 
inserting ``section 4 or 11''.
Output: Offshore Fairness Act of 2005 - Amends the Submerged Lands Act to require the Secretary of the Interior to convey the interest of the United States in the expanded submerged land of the states of Louisiana, Mississippi, and Alabama, if the state involved demonstrates that specified conditions will be met. Numbers among such conditions the requirement that the state enact, and keep updated, laws or promulgate regulations equivalent to federal law or regulations regarding: (1) the environmental protection, safety, and operations of any operation pipeline in existence on the date of conveyance; and (2) valuation of oil, gas, or other mineral production from existing interests for royalty purposes.

Provides that, if any existing federal oil and gas or other mineral lease or unit would be divided by the expanded seaward boundary of a state, the federal interest in the leased minerals underlying the portion of the lease or unit that lies within the expanded submerged boundary shall not be considered to be conveyed to the state until the date on which the lease or unit expires or is relinquished by the United States.