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August 1, 2001

H.R. 4 - Securing America's Future Energy Act of 2001
(Rep. Tauzin (R) LA and 3 cosponsors)

The Administration supports House passage of H.R. 4 and commends the House for its action in developing comprehensive and balanced national energy legislation that is largely consistent with the Administration's National Energy Plan. H.R. 4 creates opportunities and provides incentives to foster conservation, improve energy efficiency, increase domestic energy production, and expand the use of renewable energy sources. H.R. 4 represents an important step in ensuring the Nation's future energy security.

The Administration commends the inclusion of incentives from the President's budget and National Energy Policy to encourage conservation, energy efficiency, and the use of renewable and alternative energy sources. In addition, H.R. 4 will provide for the exploration and development of a small portion of the Arctic National Wildlife Refuge (ANWR) using newly-available, environmentally-friendly technology. The Administration's Plan recommended the exploration and development of this significant oil and gas resource in a manner that is protective of the environment including migratory wildlife, and the Administration is pleased that H.R. 4 incorporates this important recommendation. The Administration urges the defeat of any amendment that would eliminate this section of the bill. Finally, H.R. 4 will expand successful, existing energy efficiency programs like the Energy STAR Program and energy conservation in Federal buildings.

While the Administration strongly supports the bill, we look forward to working with Congress to improve upon provisions in the bill that are consistent with the National Energy Plan in order to ensure that the bill balances the Nation's energy needs with environmental protection.

The Administration recognizes that sections 122 and 123 are intended to facilitate financing for improvements in the energy efficiency of Federal buildings. The Administration is concerned, however, that these provisions are inconsistent with our Federal fiscal and procurement policies and would absorb significant discretionary funds. We hope to work with Congress to make these provisions consistent with sound fiscal and procurement practices.

The National Energy Plan recommends targeting royalty reductions to encourage environmentally-sound offshore oil and gas development, to reduce economic risks associated with production in frontier areas or deep gas formations, and for development of small fields that would otherwise be uneconomic. The Administration appreciates the substantial progress that has been made in regard to these provisions and looks forward to working with Congress to better target the royalty relief provided in the bill.

The Administration supports increasing automobile fuel economy. As the National Academy of Sciences report released this week demonstrates, we can achieve significant fleet fuel economy increases, without costing lives, by incorporating existing and new technologies over time. The NAS report also demonstrates, however, that simply adopting arbitrary CAFE increases could cause additional traffic fatalities. The Administration concurs that efforts to arbitrarily set new CAFE standards could impact safety and endanger lives. The Administration is eager to review existing CAFE standards through the independent administrative review process established by law, that will take into account the NAS report, passenger safety, environmental and economic concerns, and disparate impact on the U.S. versus foreign fleet of automobiles. The Administration therefore again calls on Congress to remove immediately the prohibition on the Department of Transportation so that it can responsibly craft an appropriate standard. The NAS report also highlights the need to reform the CAFE program to ensure that cost-effective technology, not less safe designs, drive future increases in fuel economy. The Administration looks forward to working with Congress to achieve significant improvements to fleet fuel economy by encouraging development and introduction of new technologies and reforming the CAFE program.

The Administration is concerned about the significant PAYGO cost of this bill which, in several cases, significantly exceeds the President's Budget and sets unrealistic targets for future programmatic funding decisions.

We support the action to not include a provision in H.R. 4 that would move the Nuclear Waste Trust Fund off-budget. The Administration would strongly oppose such a provision, which could remove these funds from Congressional and Executive control, and would significantly reduce the budget surplus.

Pay-As-You-Go (PAYGO) Scoring

Any law that would reduce receipts is subject to the pay-as-you-go requirements of the Balanced Budget and Emergency Deficit Control Act. Accordingly, H.R. 4 or any substitute amendment in lieu thereof, that would also reduce revenues or increase direct spending, will be subject to the pay-as-you-go requirement. OMB has not completed its scoring of H.R. 4, but a preliminary review indicates H.R. 4 would reduce the surplus by at least $30 billion over FYs 2002-2011. The Administration will work with Congress to ensure that any unintended sequester of spending does not occur under current law or the enactment of any other proposals that meet the President's objectives to reduce the debt, fund priority initiatives, and grant tax relief to all income tax paying Americans.