Provided By DC Tripwire
Bottom Line: The NAT GAS Act is expected to easily pass the House, where it has broad support from Members on both sides of the aisle. Challenges remain before the bill becomes law, however, the most significant of which is the determination of an acceptable pay-for, i.e. revenue raiser or spending cut to offset the tax subsidies provided in the bill. But with continued high gasoline prices and the American public demanding action, it may be that the time is finally right to send this legislation to the President’s desk. While its path through the House looks easy though, its prospects in the Senate are murkier, as it has been stymied in the Senate once before. Thus, companies which benefit from the tax benefits that would be derived form the NAT GAS Act — such as makers of fleet-based natural gas vehicles — could continue to ride a wave of high expectations as the bill winds its way through the House, but such expectations could run into a wall in the Senate.
· Last week, Reps. John Sullivan (R-OK), Dan Boren (D-OK), Kevin Brady (R-TX), and John Larson (D-CT) introduced H.R. 1380, the New Alternative Transportation to Give Americans Solutions (NAT GAS) Act of 2011, in the House.
· The bill seeks to promote natural gas as a transportation fuel by providing expanded tax incentives for the purchase and production of natural gas vehicles (NGVs) and the installation of natural gas refueling infrastructure. It also includes a section to directing funding at the Department of Energy for research and development to improve NGV performance and efficiency and to promote NVGs for their petroleum reductions and greenhouse gas reductions.
· The NAT GAS Act already has 133 bipartisan cosponsors, ranging from the most conservative to the most liberal, and both President Obama and Speaker Boehner have expressed support for legislation promoting NGVs.
· The House bill was referred to three committees – Ways and Means, Energy and Commerce, and Science.
– These multiple committee referrals could, in theory, slow the bill’s movement through the House.
– Ways and Means Chairman Dave Camp (R-MI), however, is a member of the House Natural Gas Caucus and is expected to support the bill. Additionally, Rep. Kevin Brady, a lead cosponsor of the legislation, is a member of the Ways and Means Committee.
– The road through the Energy and Commerce Committee, where Chairman Fred Upton (R-MI) has previously expressed concern about passing legislation to promote one source of energy over another, may be a bit rockier. In addition to overcoming any speed bumps with the Chairman, Democratic Members could attempt to attach any number of “poison pill” amendments to the bill in committee, including controversial amendments regarding hydraulic fracturing.
– But because the bill is supported by Speaker Boehner, and because Rep. Sullivan is a member of the Energy and Commerce Committee, these obstacles are expected to be overcome.
· Champions of the bill believe that because it is supported by both Republican and Democratic Leadership (Rep. Larson is Chairman of the House Democratic Caucus), the legislation will move quickly through the House.
· Despite its multiple committee referrals and possible challenges in the Energy and Commerce Committee, the bill is, in fact, likely to pass the House easily.
· There is even talk that the bill may be considered under “suspension of the rules,” a process typically used in the House on noncontroversial measures. This procedure limits debate to 40 minutes, permits no floor amendments, and requires the support two-thirds of Members present and voting for passage.
· Although there is not yet an official CBO score for the NAT GAS Act, back of the envelope estimates suggest that it will cost approximately $3.5 billion.
· According to the Statutory Pay-As-You-Go Act, which became law early last year, bills reducing revenues must be fully offset by cuts in mandatory programs or by revenue increases.
· Although the House Rules under the Republican leadership do not require tax cuts to be paid for, such a requirement still exists in the Senate and remains law of the land.
· At this point, the bill passed by the House is not expected to have a pay-for.
· This will present a challenge in the Senate, where companion legislation is expected to be introduced in the weeks ahead by Senators Bob Menendez (D-NJ) and Orin Hatch (R-NJ). (The bill is also supported by Majority Leader Harry Reid.)
· In the last Congress, disagreement over the pay-for prevented similar legislation from going anywhere in the Senate, and that issue could easily rear its head again, grinding the bill’s movement to a halt.
· In addition to the challenge of finding an acceptable pay-for, it remains uncertain if the NAT GAS Act would move on its own in the Senate or if would be included in a more comprehensive energy package, which would significantly slow the process and make passage more complicated.