The Senate has all but killed the contentious energy package that has loomed in the chamber for nearly a year, but portions of the bill are steadily creeping into other must-pass legislation packages.
The $13 billion in tax provisions that account for nearly all of the costs of the energy bill have been tacked on to a foreign imports tax repeal bill headed by Senate Finance Committee Chairman Charles E. Grassley, Iowa Republican.
The energy tax provisions give companies credits and incentives for renewable electricity production such as wind, and environmental improvements for cleaner coal and other fossil fuel production, among other provisions.
“This is a satisfying win for Senator [Jeff] Bingaman, who for months has made the case that the best way to achieve results on energy legislation is to break the stalled energy bill into smaller, more manageable pieces,” said a senate Democratic staffer.
Mr. Bingaman, New Mexico Democrat and ranking member of the Energy and Natural Resources Committee, suggested several weeks ago that cannibalizing the energy bill was the only way to pass the necessary portions of the legislation.
The defunct energy bill was scaled down to $14 billion in a last-ditch effort to get support from both sides of the aisle. The original House bill cost $28 billion and included a provision to protect makers of the fuel additive methyl tertiary-butyl ether (MTBE) from lawsuits.
At issue are provisions to strengthen the electric grid, construct a natural gas pipeline from Alaska to Chicago, and the MTBE protections, all of which have caused a Democratic backlash. Not to mention that Democrats still feel spurned from being shut out of last year’s conference negotiations with House sponsors by Senate Republicans.
Since then, the bill has been lingering in limbo.
House Republicans, who said they would not to pass the bill without the MTBE provision, accused Senate Majority Leader Tom Daschle “of being insincere” in his support for the bill. It has been a month since the South Dakota Democrat publicly said he had secured enough votes from his colleagues to bring the bill to the floor.
“I keep waiting for that time when the majority will bring this before the Senate for an up or down vote,” Mr. Daschle said this week.
Senate Energy Committee Chairman Pete V. Domenici, New Mexico Republican, said Democrats are holding the bill hostage for frivolous reasons.
“Unusual reasons like you didn’t give us an energy bill when we had the Senate two years ago or you didn’t let our staff work on the bill while it was in conference,” Mr. Domenici said.
Nonetheless, Mr. Grassley and Mr. Bingaman feel the energy portions in the foreign imports tax repeal bill will have better luck, even though the foreign tax bill hasn’t fared so well in the Senate so far.
This week the foreign tax bill made its second trip to the Senate floor as Democrats have refused to pass the bill without an amendment to protect overtime pay for government workers. The gridlock has cost businesses and the country collectively some $4 billion, Mr. Grassley said.
The World Trade Organization ruled last May that the foreign trade tax provisions of the U.S. Internal Revenue Code constituted a prohibited export subsidy. Therefore, the Senate is being pushed to pass the tax bill.
On March 1, the European Union began imposing retaliatory trade sanctions on a number of U.S. products as a result of the WTO decision.
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