Energy & Transportation Update
An Information Service of the AFI Energy and Transportation Committee
October 7, 2002
Volume III, Number 10
NCSL Testifies to Preserve Driver's License Security
On September 5, 2002, NCSL Transportation Committee Chair, California State Senator Betty Karnette, and Council of State Governments' (CSG) representative Kentucky State Representative Michael Weaver testified at a hearing on driver's license security issues before the House Subcommittee on Highways and Transit. The hearing focused on security procedures employed by all 50 states in issuing driver's licenses, and new efforts undertaken by states since September 11th to curtail fraudulent acquisition of licenses. The testimony given by NCSL and CSG was based on a joint report issued in June 2002 which defines issues states could address to improve driver's license integrity. The NCSL-CSG report charts state legislative actions in 2002 and proposes a variety of options for consideration by state officials.
Senator Karnette stated in her testimony, "Forty-five states have considered legislation pertaining to driver's license security during the 2001-2002 session and twenty-one states have successfully enacted driver's license security legislation in the past year. Five states were working on the issue before September 11th. Therefore . . . states have been extremely proactive and effective in providing solutions that will improve security of their driver's license system." The primary message of the NCSL/CSG report was also reflected in the White House Office of Homeland Security (OHS), which states, "...the federal government, in consultation with state government agencies and non-governmental organizations, should support state-led efforts to develop suggested minimum standards for driver's licenses, recognizing that many states should and will exceed these standards."
NCSL has met periodically with OHS staff and Director Tom Ridge to foster intergovernmental collaboration on homeland security and driver's license matters. The NCSL/CSG report is intended to serve as a resource document as congressional committees and members ponder alternatives to resolving driver's license issuance and verification matters. Only three bills have surfaced to date, none of which will get any further consideration this year. The NCSL/CSG report may be accessed on the NCSL web site at www.ncsl.org/statefed/DLRCSG.htm. Senator Karnette's testimony can be accessed on the NCSL web site at www.ncsl.org/statefed/DLSK02.htm.
Congressman Lipinski Announces Rail Funding Plan
In an informal announcement this week, Representative William Lipinski (D-Ill.) announced plans to propose legislation next session that would create a nation railroad trust fund from diesel fuel taxes paid by rail companies. The trust fund receipts would go strictly towards railroad infrastructure improvements, similar to federal funding programs for highway and airport infrastructure.
Representative Lipinski's plan, however, has not won acceptance by the railroad industry. The railroad industry has worked to repeal the federal gas tax the railroads are required to pay, arguing the government should use receipts earmarked for highways on rail-crossing improvements, which reduces congestion on roads. The railroads also argue rail gas tax receipts would stock the fund average a mere $170 million annually - only a fraction of the cost needed to fund the nation's rail infrastructure. In order to generate more revenue, Representative Lipinski has also suggested a tax on railcars, which is opposed by the railroad industry. The railroads are working to secure funding through a possible increase of the 18.3-cent federal gas tax in the federal-aid highway legislation rewrite scheduled to take place next year. An increase in the overall federal gas tax and receipts earmarked specifically for railroads would buy support for Representative Lipinski's proposal.
However, the road construction and highway transportation organizations generally support an increase in the federal gas tax, but feel strongly the gas tax receipts should only go towards highway construction and repairs.
Amtrak Pleads for Funding, New Ideas Emerge
The Senate FY 2003 transportation spending bill provides Amtrak with $1.2 billion ($800 million above the president's FY 2003 request and FY 2002 levels), the amount the Amtrak board contends is necessary to sustain operations throughout FY 2003. In June, Amtrak warned of a possible shutdown of the entire system in July if it did not receive a $200 million loan guarantee. On June 26, 2002, a letter from Missouri Representative Joan Bray, NCSL Rail Working Group Chair, urged the administration and Congress "to not only meet the short-term financial needs of Amtrak, but provide it with long-term stable sources of funding." The administration applied a quick fix to Amtrak's funding request to meet short-term operating cost by agreeing to provide Amtrak with a $100 million loan. Congress followed up by designating $204 million to Amtrak in the FY 2002 supplemental spending package. The Rail Working Group letter may be accessed on the NCSL web site at www.ncsl.org/statefed/Amtk62602.htm.
Senate Provides States with Huge Transportation Boost
On July 25, 2002, the Senate Appropriations Committee unanimously approved a FY 2003 transportation appropriations measure (S. 2808) that would set state highway obligation authority at $31.8 billion. The federal-aid highway program was set at $23.3 billion in the president's FY 2003 request by a statutorily forced downward adjustment of revenue aligned budget authority (RABA). A partial restoration in the highway funding rescission was also included in the FY 2002 supplemental spending package (H.R. 4775) signed by President Bush on August 5, 2002. The FY 2002 supplemental spending package adds an extra $4.4 billion to the federal-aid highway spending, which raises the FY 2003 spending level to $27.7 billion - the amount guaranteed in Transportation Equity Act of the 21st Century (TEA-21). The conference agreement for the supplemental package also ensures $27.7 billion is protected by budgetary firewalls and is distributed to states through existing TEA-21 formulas. The House transportation spending measure will most likely set highway funding at no higher than $27.7 billion. NCSL has sought an amount no less than $27.7 billion and urged members to get as close to the $31.8 billion as possible. In an August 28, 2002 letter to Senator Patty Murray (D-Washington), California Senator Betty Karnette, chair of NCSL's Transportation Committee, reiterated NCSL's support for funding highway programs at $31.8 billion, the amount included in the Senate transportation spending bill (S. 2808). S. 2808 also appropriates $13.59 billion to the Federal Aviation Administration ($50 million above the president's FY 2003 request and $370 million above the FY 2002 level), including $3.3 billion for the Airport Improvement Program and $62 million for the Essential Air Service. The letter sent to Senator Murray can be accessed at www.ncsl.org/statefed/Sen2808Ag.htm.
Senate Approves Yucca Mountain, Nevada Continues to Fight
On July 9, 2002, in a 60 to 39 vote, the Senate approved S.J. Res. 34 (H.J. Res. 87), moving forward the use of Yucca Mountain as the nation's permanent high-level nuclear waste repository. Department of Energy (DOE) officials plan to have a license application to the Nuclear Regulatory Commission (NRC) by 2004 and hope to begin shipment to the facility by 2010. On July 12, 2002, the state of Nevada fulfilled its promise to fight the project to the very end when it filed a petition with the NRC asking it to amend the rules governing the repository licensing. The state argues that the NRC released a new licensing requirement (Part 63 rule) in Nov. 2001 exclusive to Yucca Mountain. The new rule also clarifies that previous licensing requirements do not apply to the Yucca Mountain site.
The state's petition asks the NRC to add key components to the licensing requirements such as: to require primary isolation barriers to be geological, not manmade; to require the DOE to provide an affirmative safety case for the repository, not just an ability to meet Environmental Protection Agency's (EPA) protection standards; and to raise the safety standard from "reasonable expectation" to "reasonable assurance" of safety.
Energy Conference Progress Slow
Despite congressional energy staff meeting several times since June, little progress has been made in energy bill (H.R. 4) negotiations. Conferees have approved resolutions on the following topics:
Price-Anderson Act: The nuclear insurance plan for nuclear power plants was reauthorized (lapsed on Aug. 1, 2002) until 2017. The conference approved Price-Anderson provision closely resembles the Senate's energy bill version. The House conferees voiced complaints the conference-approved provision does not improve current nuclear security regulations.
Low-Income Home Energy Assistance Program (LIHEAP): LIHEAP was reauthorized at $3.4 billion over five years.
State and Weatherization Energy Assistance: The program was reauthorized at about $1.5 billion over five years.
Corporate Average Fuel Economy (CAFE): The fuel economy standard was tightened to conserve 5 billion gallons of oil between 2006 and 2012, a slight change from the House provision. Opponents of the provision argued the language increases the current fuel economy of less than 1 mile per gallon. Energy Conference Chairman Billy Tauzin (R-Louisiana) praised the provision, claiming it is the first time Congress has increased fuel economy standards for sport utility vehicles. Transportation Secretary Norman Mineta sent a letter this week to the energy conferees expressing disappointment that the compromise did not include language that would require the National Highway Transportation Safety Administration to consider the element of safety when revising CAFE standards in the future.
Pipeline Safety: The pipeline safety provision requires initial pipeline inspections within 10 years after legislation enactment and reinspections every seven years.
Energy conferees plan to meet this week to discuss counterproposals for the more contentious issues in the energy package. The Senate is now working through House proposals on Arctic National Wildlife Refuge (ANWR), electricity restructuring and ethanol. Other controversial issues such as energy taxes, renewable portfolio standard, climate change and a pipeline to Alaska's North Slope will probably not be addressed until deals are struck with ANWR, electricity restructuring and ethanol.
As of October 1, 2002, here are how the issues stand:
Ethanol/MTBE: The House's compromise would require the production of 5 billion gallons of ethanol by 2012 but strikes Senate language that would ban MTBE. The House opposes the Senate's MTBE ban and ethanol mandate and argues the U.S. is not capable of producing the amount that would be required to replace MTBE. The House proposal also includes a provision that would ensure the increased use of ethanol would not result in revenue short falls in the Highway Trust Fund. The Senate-passed energy bill includes an elimination of the Clean Air Act 2-percent oxygenate mandate.
Arctic National Wildlife Refuge (ANWR): The majority of energy conference news last week focused on ANWR negotiations. A House proposal would permit oil production on the refuge within a surface impact of 2000 acres or less and would add 10.2 million acres to the wilderness refuge area. The impact area does not include exploration activity or above ground pipelines. The Republicans have said they would accept climate change provisions as a compromise for ANWR passage, but no deal has been finalized.
Electricity Restructuring: The Republican House conferees plan to offer Senate conferees an electricity restructuring proposal drafted by Representative Joe Barton (R-Texas). Rep. Barton's proposal includes voluntary regional transmission organization (RTO), a repeal of the Public Utility Holding Companies Act and an increase of net metering for renewable energy sources. The language would not give the Federal Energy Regulatory Commission (FERC) the power to mandate RTOs unless it is deemed crucial to transmission operation in a certain area or if states and local authorities are unable to reach a resolution after a year of negotiations. Another controversial issue is a renewable energy provision requiring an increase in the amount of electricity produced from renewable resources over the next two decades. The Senate-passed version of the energy bill includes a provision that would require each state to incrementally increase between 2005 and 2020 the amount of electricity produced from renewable sources to 10 percent of the state's electricity production. Chairman Tauzin voiced concern because the provision "preempts state programs" and because, he claimed, the average cost of renewable power is higher, thereby raising the average cost of power.
Energy Tax Incentives: Senate Finance Committee Chairman Max Baucus (D-Mont.) stated that the administration has voiced approval of the conference-approved $15 billion in energy tax incentives - similar to the Senate proposal, but well below the House bill's energy tax incentive package.
President Bush has stressed to Congress that the completion of an energy package before a possible October recess is a top priority for the administration.
NCSL Staff:
Eileen Doherty
Committee Director
AFI Energy and Transportation Committee
(202)624-8687
Laurie Holmes
Committee Assistant
AFI Energy and Transportation Committee
(202)624-8695
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