- The Washington Times - Sunday, July 24, 2005

ASSOCIATED PRESS

House and Senate conferees yesterday abandoned giving makers of the gasoline additive MTBE liability protection against environmental lawsuits, removing the major roadblock to enactment of broad energy legislation.

Senate negotiators rejected a House proposal for an $11.4 billion MTBE cleanup fund that House Republicans had hoped would serve as a compromise and still provide the liability shield to the oil industry.

But Rep. Joe L. Barton, Texas Republican, said the proposal “has not been accepted by the Senate” and that he would offer another MTBE proposal today.

Sen. Pete Domenici, New Mexico Republican, leader of the Senate energy negotiating team, said that while some MTBE issues were still being discussed, those did not include a cleanup fund, nor liability protection.

“Those are gone,” Mr. Domenici told reporters as the House-Senate conferees held an unusual Sunday session in hopes of completing work on a sweeping energy bill by tonight.

If the negotiators are successful, an energy bill could pass Congress before week’s end, meeting an Aug. 1 goal to have a bill at the White House, as urged by President Bush.

The legislation creates billions of dollars in tax breaks and other federal subsidies, such as loan guarantees, for energy industries and for energy conservation. It also would provide a boon to farmers by requiring billions of gallons of corn-based ethanol to be used in gasoline, although the amount remains to be negotiated.

Mr. Bush telephoned the House-Senate conference leaders yesterday, reiterating his desire to get energy legislation passed this week before lawmakers begin their summer recess. “It was a very cordial, positive kind of touching-based phone call,” said Mr. Barton. He said specific issues such as MTBE were not discussed.

The MTBE liability issue has dogged lawmakers trying to pass an energy bill for more than two years. Many senators have vowed to block any bill that includes a House-favored measure that would shield MTBE makers against lawsuits claiming the additive is a defective product and that the industry knew years ago it would pose cleanup problems if it leaked into water supplies.

An additive introduced into widespread use in the mid-1990s to reduce air pollution, MTBE has been found in drinking-water supplies in at least 36 states, causing foul taste and smell. Communities and water agencies say they’re facing billions of dollars in cleanup costs. More than 150 lawsuits have been filed seeking cleanup payments from MTBE producers.

On Friday, Mr. Barton proposed a $11.4 billion cleanup fund for MTBE, a third of which would be paid for by the oil industry, including MTBE manufacturers, refiners and gasoline station owners. But the proposal drew criticism from all sides.

The MTBE liability issue had been viewed by Senate negotiators, especially Mr. Domenici, as a deal breaker that — as it did two years ago — would scuttle any chances of getting an energy bill through the Senate.


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