Thursday, February 2, 2012

Drilling opposition takes right turn (Politico)

A long-term ?jobs bill? funded by oil drilling: For a conservative, what?s not to love?

Plenty, it turns out. Opening the Arctic National Wildlife Refuge to drilling has been a conservative dream for years ? but using it to pay for transportation wasn?t part of the plan.

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Conservative policy watchers aren?t thrilled that House Republicans are moving swiftly on a sweeping transportation funding bill that will include billions of dollars in funding derived from expanded energy production.

The drilling provisions are intended to lure Republican support for a bill that doesn?t cut spending, a stated goal of many rank-and-file conservatives.

?One of the problems you have in Washington, is you take really bad legislation, which the highway bill is, and you put a sweetener in it,? said Heritage Action for America CEO Michael Needham. ?That?s what?s going on here.?

Erich Zimmermann, senior policy analyst at Taxpayers for Common Sense, is also wary of the combination.

?The primary issue we have is the speculative nature of the future revenues we could expect. The fact is the [Highway] Trust Fund is going broke now, and the House bill would spend money now,? Zimmermann said. ?Simply because a lease is offered doesn?t mean it will be purchased, and just because it?s purchased doesn?t mean that drilling will occur right away. From our point of view, this is not a responsible budget approach.?

Combining drilling and transportation has resulted in some strange bedfellows. Zimmermann?s remarks came during a conference call that included the Natural Resources Defense Council, the Reason Foundation and the Competitive Enterprise Institute, all of which oppose funding transportation with drilling.

Sen. Jim Inhofe (R-Okla.), former chairman of the Senate Environment and Public Works Committee and a well-known supporter of domestic energy production, said the House shouldn?t be using drilling to pay for highways. ?You can?t very well use revenues you don?t have,? he said last week.

Number-crunchers back Inhofe?s view.

In November, West Virginia Rep. Nick Rahall, top Democrat on the House Transportation and Infrastructure Committee, distributed a 2008 Congressional Budget Office report, which showed that Outer Continental Shelf drilling receipts would have totaled about $2 billion over a nine-year period, far short of the expected funding gap for the highway bill.

A letter from Senate Finance Committee Republicans in November suggested ways to help the Senate fill its own funding gap of nearly $13 billion. But even those rosier CBO estimates cited by the Republicans projected only about $5.2 billion from more drilling in Alaska and OCS over 10 years.

And there have been rumblings among conservatives that by using energy production for funding, the gas tax will be unhitched from infrastructure funding, which will later require more aid from the general fund. Taxpayers have bailed out the Highway Trust Fund three times, to the tune of $35 billion over the past few years.

Marc Scribner, a transportation policy analyst for the Competitive Enterprise Institute, said it would be disastrous to end the ?user pays? concept that has dominated transportation financing since the conception of the interstate highway system in the 1950s.

According to Scribner, the current mix of funds ? dominated by the gasoline tax ? is superior for four reasons: It?s fair, it?s proportional to road use, it provides predictable funding levels, and it offers an important positive signal to investors.

Though Heritage supports an eventual move to a devolution model that would give states more transportation power, Needham said that for now ?highway spending is paid for out of the trust fund, and money should go into that based on the gas tax.? That was the way Congress worked until recently, Needham said, until ?they totally blew that up in 2005 with the last highway bill, which was one of the reasons that people got sick of the Republican Congress.?

Needham also suggested House leaders are rushing the bill: ?As more and more people get educated about this, there are members who are starting to raise eyebrows. That?s one of the reasons this is moving so quickly.?

Source: http://us.rd.yahoo.com/dailynews/rss/politics/*http%3A//us.rd.yahoo.com/dailynews/external/politico_rss/rss_politico_mostpop/http___www_politico_com_news_stories0112_72235_html/44373904/SIG=11mq72187/*http%3A//www.politico.com/news/stories/0112/72235.html

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