Appropriations Update
Prior to recessing for the November 2002 elections, Congress passed a continuing resolution (HJ Res 123) to keep the federal government in operation through November 22. Both chambers will reconvene November 12 to elect leaders for the 108th Congress, organize and adopt rules and potentially address unfinished business that includes passing 11 of the 13 Fiscal Year (FY) 2003 appropriations measures. Table 1 summarizes the status of select appropriations bills.

EPA FY 2003 Appropriations
On October 9, 2002, the House Appropriations Committee passed the FY2003 VA-HUD Appropriations bill that includes $8.2 billion for Environmental Protection Agency (EPA) in FY 2003. Table 2 summarizes proposed funding for select programs.

(Amounts in millions of dollars)

Wastewater Security
On September 5, 2002, the House approved The Wastewater Treatment Works Security Act (H.R. 5169), which authorizes $220 million in grants to assess security enhancements in public water treatment facilities. On October 3, 2002, Chairman James Jeffords (I-Vt.) of the Senate Environment and Public Works Committee introduced a similar bill (S. 3037) that authorizes nearly $200 million in water security grants. The House version of the bill would make the vulnerability assessments voluntary while the Senate version would make the assessments mandatory. Unlike the House bill, the Senate bill would require the wastewater industry to complete emergency response plans within 180 days of an assessment's completion. It is unlikely the Senate will address this issue before next year.

Energy Conference Update
Resolved Issues: Despite congressional staff meeting almost every week since June, progress on the energy bill (H.R. 4) has been slow. Conferees have agreed 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.

Corporate Average Fuel Economy (CAFE): The fuel economy standard will be tightened by National Highway Transportation and Safety Administration (NHTSA) to conserve 5 billion gallons of oil by 2014, a slight change from the House provision. Opponents of the provision argued the language does not go far enough. The new standard will increase the current fuel economy by 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 last month to the energy conferees expressing disappointment that the compromise did not include language that would require NHTSA to consider the element of safety when revising CAFE standards in the future.

Unresolved Issues: Congressional staff will continue to meet during the recess to discuss counterproposals for the more contentious issues in the energy package. The Senate is now working through House proposals on drilling in the Arctic National Wildlife Refuge (ANWR), electricity restructuring and ethanol use. 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 on ANWR, electricity restructuring and ethanol are struck. Congress will attempt to resolve the following issues when they return to Washington in mid-November:

Ethanol/MTBE: The latest proposal includes a House provision to 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 compromise also includes a House 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 has focused on ANWR negotiations. The 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. House Republicans have said they would accept climate change provisions as a compromise for ANWR passage, but the House Republicans defeated (by a vote of 15-2) a Senate Democrat climate change provision compromise on October 3, 2002.

Electricity Restructuring: The Republican House conferees offered 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. A 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. Barton's provision was passed narrowly, but the Senate is not expected to approve the measure.

Energy Tax Incentives: Senate Finance Committee Chairman Max Baucus (D-Mont.) stated that the administration has voiced approval of the conference-proposed $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 the end of the session is a top priority for the administration.