Talks drag out on riders, crude exports as deadline looms

Source: Geof Koss, E&E reporter • Posted: Wednesday, December 9, 2015

Congressional leaders continue discussions to head off a government shutdown in three days, with policy riders and a possible repeal of the crude exports ban remaining in the mix of controversial items left undecided.

Senate Appropriations Committee ranking member Barbara Mikulski (D-Md.) yesterday told reporters the omnibus spending bill “is kind of in a frozen state for a bit” while negotiators continue work on a tax extenders package.

“But we’re making very good progress on trying to resolve the money issues,” she told reporters. “We have about 40 or 42 poison pill riders, some are really big, Hobby Lobby, campaign finance reform, things that never really should have been on appropriations. So we’re kind of stuck at the riders.”

Mikulski said she had a “very positive” conversation with House Appropriations Chairman Hal Rogers (R-Ky.) over the weekend but signaled that negotiations have since moved to a higher level.

“Now we’re at the White House, leadership level and these things, the tax extenders, and really we need a breakthrough with the 42 riders,” she said.

In the meantime, a short-term continuing resolution to keep the government running past Friday appears likely.

Lawmakers on both sides of the Capitol yesterday signaled that a repeal of the crude exports ban could still find a home in end-of-year legislation.

While the House has unveiled a two-year tax extenders package that doesn’t address the export ban, the maneuvering continues.

House Ways and Means Chairman Kevin Brady (R-Texas) said he hasn’t given up hope on a broader tax package that could make some credits permanent.

“We continue the discussions,” he said. “We’re very hopeful people will decide that that balanced, pro-growth package is the right way to go. We’re just so tired of the uncertainty that goes with these end-of-the-year extenders. We don’t get the bang for the buck with these provisions, and frankly it’s a huge waste of time and energy and resources.”

Asked if crude exports could hitch a ride in extenders, Brady told E&E Daily, it remains “in the general discussion of a number of year-end areas. To my knowledge, it hasn’t been decided yet.”

Sen. John Thune (R-S.D.) said the prospects for a deal on exports remain unclear.

“I think there’s some Democrat support for that,” he told reporters. “I don’t know if it’s enough to get it into one of these year-end bills, but I think it’s still under consideration, and I think everybody realizes there’s a logic behind doing that. Why would we limit the producers in this country from being a force in the global market and allow countries like Iran to export their oil to other places around the world and not have our producers be able to do that?”

Noting that he’s a “fan of renewables,” Thune said he hoped a deal could be struck to incentivize development of clean sources.

“There are some of those in the tax extenders bill; how that gets handled remains to be seen,” he said. “There’s some discussion about phaseouts of some of those, but I think the main thing we want to get is to where America is increasingly energy independent, less dependent upon foreign sources of energy.”

Noting the House’s two-year tax package, Sen. John Hoeven (R-N.D.) said yesterday the chips are falling in place for an exports deal.

“It seems to me that all the elements are there to get this done and include oil exports and the other side can’t keep adding more and more to the mix,” he told E&E Daily.

When it was pointed out that the House tax extenders bill extends the production tax credit for two years but is silent on the investment tax credit for solar, Hoeven noted that incentive doesn’t expire until the end of 2016.

“There are some other aspects of that that are being talked about, but I can’t go into that,” he said.

Asked if a change to the ITC’s qualification terms to a “commence construction” requirement for projects was one option, Hoeven responded, “Well let’s just say that could be an example, but again I don’t want to get into specifics.”

Senate Minority Whip Dick Durbin (D-Ill.) reiterated yesterday that Democrats see crude exports as a major bargaining chip in the end-of-the-year talks.

“It’s still being debated,” he told E&E Daily. “It’s clearly an item which [Senate Majority Leader Mitch McConnell (R-Ky.)] and Republicans are salivating over, it would be a windfall to the industry, we don’t know how much. Some have estimated $20 to $30 billion in profits if they’re allowed to do this. It has some consequences — refineries and the availability of sweet crude in some parts of the country. So the discussions and the trading are going on.”

Aides and lobbyists said yesterday that if congressional leaders ultimately decide to move a two-year extenders package, crude exports remain a bargaining chip in omnibus discussions. Non-tax items on Democrats’ wish list for an export deal reportedly include permanent reauthorization of the Land and Water Conservation Fund, as well as funds for the Payment in Lieu of Taxes and Secure Rural Schools programs.

Exports could also play a factor in negotiations over riders.

Senate Energy and Natural Resources Chairwoman Lisa Murkowski (R-Alaska) last night noted that she’s not privy to the top-level discussions but said there’s a host of issues that could be negotiated in exchange for ending the exports ban.

“I think it’s fair to say there’s plenty of stuff out there,” she told E&E Daily. “But who knows what’s in the mix.”

Reporters Corbin Hiar and Hannah Hess contributed.