ANWR: No Arctic Drilling Expected in House Budget Package

Breaking with the Senate, the House is not expected to assume revenue from Arctic National Wildlife Refuge oil drilling in its budget resolution, though some sources think advocates of refuge energy development may yet find a way to use the House budget process to advance the issue.

With the House Budget Committee set to mark up its version of the fiscal year 2007 budget resolution this week, Republican sources say the measure will not include a reconciliation instruction to the Resources Committee large enough to match expected federal revenues from lease sales on the refuge's coastal plain.

The Senate narrowly passed a budget blueprint March 16 that includes $3 billion in expected revenue from ANWR in its instruction to the Senate Energy and Natural Resources Committee. Last year's House budget provided a $2.4 billion instruction to Resources Committee Chairman Richard Pombo (R-Calif.), a figure that roughly matched estimates at the time of how much revenue lease sales would bring to the U.S. Treasury.

Efforts to allow ANWR drilling collapsed in Congress last year despite pro-drilling majorities in both chambers. Winning approval is complicated because Senate supporters lack the 60 votes needed to end a filibuster if ANWR is addressed through regular legislation, and as a result drilling backers have included it in budget measures immune from filibuster.

In the House, the combination of Democrats' opposed to GOP budget bills and moderate Republicans makes it difficult to include ANWR in the budget package. Republican leaders had to dump ANWR last year to win passage of a reconciliation package.

Kirk Walder, an adviser to the moderate Republican Main Street Partnership, said he expects an equally aggressive anti-drilling effort from GOP moderates this year. "I think they are very confident," he said.

"We got a strong response from pro-environment segments in members' districts," Walder added. "We had a number of members who shared their district experiences of people who came up to them on the street and said, 'Thank you for blocking ANWR.'"

One House GOP aide said including a smaller instruction to Pombo's committee possibly signals the leadership may not hold out much hope for moving Arctic drilling language in an election year. Even Pombo has indicated in recent weeks that winning approval for drilling this year may be difficult.

Still, a reconciliation instruction to Pombo's committee that is far smaller than expected ANWR revenues would not by definition prevent an effort to open the refuge through the reconciliation process. The committee could seek to raise more revenues than called for by the reconciliation instruction. Last year, in fact, the reconciliation package that cleared the Resources Committee was larger than the instruction after the committee reported a measure that included ANWR, wider offshore drilling and other revenue-raising measures.

Asked whether Pombo would seek to address ANWR through reconciliation if the instruction is indeed far smaller than anticipated federal ANWR leasing revenues, Pombo aide Brian Kennedy said no decisions have been made. "The chairman is considering several options for ANWR, and has not ruled anything out yet," he said in an e-mail exchange.

The $2.8 trillion Senate budget blueprint approved March 16 steers clear of seeking cuts to mandatory spending programs that proved so controversial in the fiscal 2006 process, when Congress ultimately agreed to a $39 billion deficit reduction package. The only reconciliation instruction in the Senate package is the ANWR-linked language for the energy committee.

House leaders plan to address mandatory spending in some capacity this year, but the overall effort is expected to be far smaller than last year's plan overall. A conservative GOP aide expects it to include "no brainer" reforms to some spending programs.

One looming question is whether an eventual House or conference reconciliation package -- if it were to include ANWR -- could be palatable enough to attract support from Democrats that back refuge development to offset opposition from GOP moderates. The Senate ANWR plan was crafted to entice the support of Sen. Mary Landrieu (D-La.) for the budget package, which narrowly passed on a 51-49 vote on March 16.

It provides up to $10 billion in Gulf Coast protection and restoration funding, to be generated by ANWR lease sales, offshore drilling revenues and digital spectrum sales (E&E Daily, March 17).

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