Senate Democrats last Wednesday soundly filibustered efforts to send a corporate tax cut bill back to committee to add a $13 billion energy tax package to the legislation. Talks, however, were underway between Senate leaders last week to reach a compromise with Democrats to clear the way for a more favorable vote when lawmakers return from their week-long recess.

Republicans fell 10 shy of the 60 votes needed to end debate on a motion to recommit the corporate tax reform measure to the Senate Finance Committee to tack on the energy tax portion of the broad energy bill. It was the second time in less than a month that Democrats successfully blocked the corporate tax bill (S. 1637).

By adding on the widely supported energy tax package, Republicans had hoped that they would win more Democratic votes for the corporate tax reform bill, formally known at the Foreign Sales Corporation/Extraterritorial Income (FSC/ETI) measure. They also figured it was a way of pushing at least half of the energy bill through the Senate.

Immediately following the vote on the cloture motion, Senate Majority Leader Bill Frist (R-TN) said both sides were trying to prepare a list of “germane” amendments in order to clear a “pathway for completion of this [corporate tax] bill.” GOP and Democratic leaders were trying to work out a deal before leaving for recess Friday in which Senate Democrats would be allowed to propose a limited number of amendments to the corporate tax reform bill if they agreed to stop filibustering the measure.

Democrats “just want the opportunity to offer amendments relevant to this [corporate tax] bill,” said a spokesman for Senate Democrats. The negotiations between the two sides “are not expected to be…easy,” he noted, adding there are “a lot of amendments that have to be discussed.”

The overarching corporate tax measure, also referred to as the JOBS bill, and the energy tax package were placed on hold until after the Senate returns from its one-week spring recess.

Chairman Pete Domenici (R-NM) of the Senate Energy and Natural Resources Committee accused Democrats of continuing “their reckless practice of politicking energy while the price of oil, gasoline, home heating oil, natural gas and coal continues to climb.” He further charged that Democrats “deliberately obstructed a bill that would create 650,000 new jobs for out-of-work Americans devastated by outsourcing.”

The Senate Democratic spokesman pointed out, however, that Democrats weren’t the only ones to oppose the motion to recommit. “At least three Republicans voted against cloture” as well.

In an effort to jump-start the languishing energy bill, Domenici last Monday mapped out a new game plan for the tax portion of the energy measure to be moved through the Senate on a separate track ahead of the rest of the legislation (S. 2095). The GOP strategy, however, rests on the energy tax package being piggybacked to the corporate tax cut bill.

The tax package proposes incentives for the development of an Alaska natural gas pipeline, including a controversial floor price for gas produced in Alaska and transported over the line; a new credit for oil and gas production from marginal wells; accelerated depreciation for gas gathering lines; and expensing of geological and geophysical costs, as well as a number of other initiatives.

When or if the energy tax piece clears the Senate, Domenici said he would then turn his efforts to the authorizing portion of the comprehensive measure. This part of the bill would enforce electricity reliability standards; mandate the use of more ethanol, offer loan guarantees for the construction of the Alaskan gas pipeline; repeal the Public Utility Holding Company Act; encourage clean coal and enact a host of other proposals.

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