In an attempt to breathe new life into the languishing energy bill, Chairman Pete Domenici (R-NM) of the Senate Energy and Natural Resources Committee announced on Monday a new strategy in which he plans to move the $13 billion tax portion of the measure through the Senate on a separate track ahead of the rest of the legislation.
Domenici said the energy tax portion has been piggybacked to a revised international tax reform bill, which was introduced in the Senate Monday by Majority Leader Bill Frist (R-TX). Senate Democrats filibustered the measure, formally known as the Foreign Sales Corporation/Extraterritorial Income (FSC/ETI) legislation (S. 1637), in late March. Republicans are expected to try to bring the revised version of the bill (with the energy tax packaged attached) to the Senate floor for consideration.
“First, I am going to get the [energy] tax provisions passed by attaching [them] to a revised FSC/ETI,” said Domenici in explaining his new game plan. The tax package includes incentives for the development of an Alaska natural gas pipeline, including a 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.
Once the tax piece is passed by the Senate, “I will turn my efforts to the authorizing portion” of the broad energy bill, he noted. This part of the energy measure 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.
“I don’t think the price of gasoline or natural gas will drop until we get the energy bill done. As prices climb and public pressure builds — I ‘will’ get this done,” Domenici pledged. “Some will ask how we are going to solve our differences with the House. We’ll work them out.” He provided no details on how this will be accomplished, however.
“We just thought this was a win-win for both parts of the bill. The [energy] tax package is very popular. Republicans are happy if it can help them get some votes on [the FSC/ETI bill], and we see this as a way of getting half of the energy bill done,” said Domenici spokeswoman Marnie Funk.
Splitting the energy bill into two parts also will result in a net savings of $1.2 billion for the authorizing portion of the measure, she noted.
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