American Oil and Gas Reporter - January 2012 - 31

with their own image problems associated
with their initial rejection of the Senate's
payroll tax holiday. Communiques from
groups such as the National Payroll Reporting Consortium-which held that the
Senate's two-month extension could not
be implemented properly-suggested House
Republicans' had a viable argument on
the merits. Even so, their reconsideration
two days later suggested the GOP decided
to cut its losses in a public relations battle
likely to worsen if most American workers
had to pay higher taxes on Jan. 1.
According to Frost, the fact that the
Senate bill passed by an 89-10 margin
contradicted any attempt by the House
leadership to cast the issue as a Democratic
Senate attempting to bully a Republican
House. Furthermore, since the Senate bill
contained the Keystone rider but not a
millionaire surcharge, House Republicans
appeared in danger of snatching defeat
from the jaws of victory.
"It looks like they cannot take yes for
an answer," Frost assessed before the
House passed the Senate's extension.
"They got the 60-day decision on the
Keystone pipeline into the Senate bill,
which forces the president's hand prior
to the election. Even if he says no on
Keystone, at least there will be a clear
decision and they can use it as a campaign
issue."

As for why the Senate's Democratic
leadership permitted the Keystone amendment to appear in the bill, Fuller says he
does not know. "Maybe it was a matter
of counting votes. Maybe it was the union
support. Maybe it had to do with relations
with Canada," he offers. "I don't know
the behind-the-scenes politics with regard
to the pipeline among the Democrats,
but the fact that Max Baucus, D-Mt., and
some Senate Democrats expressed support
for the pipeline in a letter to the House
leadership tells me there was pressure on
Democrats that may not have been evident."
Looking Ahead
As Fuller considers the legislative outlook for 2012, he predicts the election
year will yield a wealth of symbolic acts
on Capitol Hill and a dearth of substantive
ones. Similarly, he says energy initiatives
that passed the House in late 2011 that
would trim the Environmental Protection
Agency's authority or agenda-such as
HR 2401, the Transparency in Regulatory
Analysis of Impacts on the Nation
(TRAIN) Act-are unlikely to find traction
in the upper chamber.
"I simply do not see the Senate being
willing to take up those bills in a straight
debate for an up-or-down majority vote,"
he reasons. "There may be efforts to try

to attach one of them to what might be
perceived as a must-pass bill, but I do
not think we will see them debated directly."
The same seems true for other bills
that either have garnered or probably
would garner industry backing, he continues. Political dynamics and election
year politics probably limit the potential
for a bill such as HR 7, the American
Energy & Infrastructure Jobs Act, which
would require the federal government to
lease offshore areas estimated to contain
the most oil and natural gas resources,
establish clear rules for developing U.S.
oil shale resources while promoting shale
technology research and development,
and open a small portion of the Arctic
National Wildlife Refuge.
Meanwhile, suggestions floated in
Congress to expand mineral leasing on
federal lands and direct royalty revenue
to federal highway funds confront challenges beyond anti-development objections, Fuller suggests. Although such a
proposal could speak to lawmakers' political misgivings about hiking the gasoline
tax, he notes that under one of the federal
budget's more arcane accounting rules,
royalties from expanded leasing would
not necessarily be classified as new revenue, and therefore the legislation could
register as new, unpaid-for spending.

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American Oil and Gas Reporter - January 2012

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