U.S. House Passes Defense Spending Bill Linking Drilling, Gulf Coast Aid

U.S. House lawmakers early this morning passed legislation allowing new Arctic oil and gas drilling that steers leasing and royalty money toward Gulf Coast rebuilding, clearing the way for a bruising Senate fight beginning today.

The Arctic National Wildlife Refuge provision was included in the fiscal year 2006 Defense appropriations bill that also includes $29 billion in hurricane rebuilding funds, avian flu spending, as well as an across-the-board cut in discretionary spending.

The bill passed 308 to 106, and Senate consideration could start as soon as today. Senate Minority Leader Harry Reid (D-Nev.) said last night he expected debate to last for several days.

The ANWR provision includes a "Gulf Coast Recovery and Disaster Prevention and Assistance Fund." The language would steer 80 percent of federal funds from ANWR lease sales authorized in the bill to state and local governments affected by hurricanes Katrina, Rita and Wilma. It would also steer 20 percent of drilling royalties to the affected states.

The language also steers up to $2 billion from the sale of broadcast spectrum to affected Gulf Coast states if those sales exceed $10 billion. Additional spectrum funding above $12 billion is steered toward conservation and wetlands programs, including the land and water conservation fund, the environmental quality incentives program, funding to carry out the North American Wetlands Conservation Act, and other programs.

A summary of the spectrum and ANWR funding plans circulated among conferees as the measure was being hashed out yesterday pegs the amount that could be steered toward the conservation programs from spectrum sales at $1 billion.

The bill envisions two lease sales later this decade. Backers of ANWR development are now assuming leasing revenues could generate $10 billion -- to be split 50-50 with the state of Alaska -- from sales in fiscal years 2008 and 2010. Environmentalists say this estimate, recently offered by the Congressional Budget Office, is far too high.

Louisiana gets the largest share of the various gulf restoration payments in the bill, at 50 percent, with 25 percent to Mississippi and less to Alabama, Texas and Florida. The money would fund efforts including coastal restoration and flood protection in Louisiana, estuary and fisheries restoration, and wastewater system upgrades in Mississippi among other uses.

The bill also steers $2 billion toward low-income home heating assistance.

Environmentalists and other critics savaged Stevens' plan to link ANWR aid to gulf restoration. "It is pretty cynical to tie speculative money to pay for levees. It may be a new low for Senator Stevens," said Athan Manuel of U.S. PIRG.

"You are trying to make Gulf Coast states an offer they can't refuse," said Rep. David Obey (D-Wis.) during debate yesterday in the conference committee, referring to the funds from ANWR and spectrum sales. But Stevens bristled at the charges, saying he was making a sincere effort to help Gulf Coast rebuilding. "I am deeply committed to this," he said of money from ANWR and spectrum sales in the package.

Environmentalists stalked the Capitol through the weekend to appeal to members as the pivotal Senate votes loomed.

Sen. Dianne Feinstein (D-Calif.) said during the conference debate that as many as three separate points of order could be raised against the ANWR language on the Senate floor. The most commonly mentioned challenge that opponents plan to lodge on the Senate floor is under Rule 28, which allows a point of order to be raised against items added in conference that were in neither chambers' original bill.

A simple majority is needed to appeal a rule of the chair on a successful point of order against the ANWR language. But Democrats have said repeatedly in recent days that doing so would be a major change in Senate precedent. Last night, on the Senate floor, Reid blasted the GOP's "arrogance of power."

"This abuse of power will have long-term ramifications in this body. And is as bad or worse than anything ever attempted before, including the nuclear option," Reid said. The "nuclear option" referred to the GOP leadership's consideration, ultimately avoided, of changing Senate rules to prevent filibuster of judicial nominees. Reid threatened to use procedural tactics to slow debate in the Senate if the GOP presses ahead.

A question looming over the issue is whether there are 60 votes to break a filibuster, which Democrats have held open as a possibility. Sen. John Kerry (D-Mass.), speaking with reporters late last week, said it was not clear if drilling opponents had enough support to uphold a filibuster on the conference report. "It is a tough vote for a lot of people," he said.

ANWR drilling has won 51 votes in two Senate votes this year, leaving supporters shy of a filibuster-proof majority. However, inclusion of the measure on a must-pass defense spending bill could change the calculus -- Stevens and Sen. Pete Domenici (R-N.M.), a key drilling backer, have said in recent days they believe they are close to the 60 needed to cut off debate and force an up-or-down vote.

This morning's House vote underscores the difficulties members that oppose drilling have when it is part of a broader defense spending bill. The bill carried in the House with over 100 Democratic votes, which is far more than the number of House Democrats that support ANWR drilling. About 30 House Democrats support drilling. Some of the moderate Republicans that oppose drilling also supported the defense bill.

Stevens defended the provision in the Capitol over the weekend. On Saturday, talking to reporters, he linked the ANWR language to national security when asked about criticism he was tacking an unrelated drilling plan onto the defense bill. "Unless we wake up, we are going to find ourselves in a war some day without domestic oil, without oil we control," he said.

Reprinted from E&E Daily with permission from Environment & Energy Publishing, LLC. www.eenews.net 202/628-6500.