Oil and gas in Washington
Tax relief for oil patch hanging onAs Congress started rushing toward its month-long August recess, domestic oil and gas producers became more anxious about the controversial tax-relief legislation containing help for domestic oil and gas producers. Would it survive the pounding of its liberal opposition? The infighting had come down to the $792-billion Republican tax cut and relief plan. The movement that will culminate in the final congressional approval began on July 23rd with the House of Representatives’ passage of its version of H. R. 2488. The Senate passed its version of the bill a week later, after the Republicans and a few Democrats defeated repeated Democrat attempts to revise the programs or funding of the determined majority. Staying on the fast track, the two bodies’ conferees began their negotiations right away and continued late into the night. They resumed early the next morning. Conferees from both sides were involved when they started, but the Democrats were quickly excluded. The determined Republicans reached agreement between the House and Senate late in the evening of August 4th. At almost every step, President Clinton was running around the country threatening the Republicans that — if they do not cave in and do it more his way — he will veto the bill. On Aug. 5th, The Washington Times editorially supported the conference report, saying the bill as approved is not as good as the bill the House conferees put on the table; but the compromise report is still substantially better than anything President Clinton has offered. The editorial suggested that anybody concerned about the excessive level of federal taxation should support these tax cuts. It said, "This year ... Federal taxes will command a higher percentage of economic output (20.6%) than in any year in U.S. history — except for 1944 (20.9%) at the height of World War II." The Washington Post said, "Defying President Clinton’s veto threats, the Republican-controlled Congress yesterday gave final approval to a large tax cut on a day marked more by political positioning than lawmaking that will endure." The House passed it by a solid vote of 221 to 206. However, the Senate vote later in the day was a real squeaker — 50 to 49 — with four Republicans voting with the Democrats; one independent voted yes and one Republican was absent. Al Gore was standing by in case he had to cast the tie-breaking vote. House Speaker J. Dennis Hastert (Illinois) and Senate Majority Leader Trent Lott (Mississippi), learned a lesson a few years back when Clinton shut down most of the federal government by a similar political veto and blamed it on the Republicans. So, rather than sending the bill on to the White House right away, the Republicans have held it through the recess. They will use it during that time to take their program to the American people instead of relying on paid political pollsters, in hopes of forcing Clinton to sign the new law. As a parting shot, Senate Finance Chairman William V. Roth, R-Delaware, said, "Mr. President, the fundamental question ... is quite simple: Is it right for Washington to take from the taxpayers more money than is necessary to run the government? Individuals and families are due a refund." Oil and gas producers successfully holding their own. When the conference committee report was filed (H. R. 2488, Taxpayer Refund and Relief Act of 1999), the final version did include the five provisions in which oil and gas producers are so interested (see box for a short listing of the items).
Oil royalty moratorium still up in the air. During consideration of the Interior Department’s FY 2000 appropriations bill, the Senate reverted one of its key parliamentary procedures to its status before 1995. That action resulted in a serious blunder — so far as oil companies are concerned — because it also inadvertently removed, from the appropriations bill, wording extending the oil royalty valuation moratorium until June 30, 2001. To correct that situation, Senators Kay Bailey Hutchison, R-Texas, and Pete Domenici, R-New Mexico, are working diligently on an amendment to reword the proposed moratorium extension that will meet the parliamentary test. As usual, the arch foe of the extension, Sen. Barbara Boxer, D-California, and her cronies are doing everything they can to stymie the amendment from being passed. Action on the Interior appropriations bill has not been completed yet, but it is scheduled to be on the agenda when the Senate returns on September 7. On July 30, a group from the Frontiers of Freedom and more than 20 other groups signed a joint letter to all senators urging them to support the Hutchison-Domenici amendment. The core message pointed out that the proposed oil royalty valuation rule is primarily a tax increase being implemented by federal bureaucrats. After refuting several false claims by Greenpeace and others, the letter also asked that the rulemaking be delayed until a government probe — of the gifts to two federal employees who accepted money from the Project on Government Oversight (POGO) from proceeds of an oil royalty settlement with an oil company — is complete. While Congress is home until September 7th, and when they get back, contact them seeking
their support for the Hutchison-Domenici amendment and the industries’ tax relief in H.
R. 2488.  Charles D. Matthews is president of Charles Matthews & Co., consultants and advocates on government relations, Arlington, Virginia.
Copyright © 1999 World
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