House Bill Calls for New Refineries

The House on Friday approved legislation that seeks to spur construction of oil refineries -- the first major congressional response to rising energy prices and tight supplies following Hurricane Katrina.

The bill passed, 212-210, but only after House GOP leaders extended the roll call from a scheduled five minutes to about 40 minutes to round up the votes. Partisan tensions boiled over, with Democrats shouting, “Shame! Shame! Shame!” to protest the prolonged vote.

The measure was approved after the bill’s GOP sponsors dropped the most contentious provision -- relaxing anti-pollution rules for refinery projects -- after moderate Republicans threatened to vote against the bill and possibly kill it.

Still, every Democrat who was present voted no, contending that the legislation was designed more to shield the GOP-controlled Congress from political fallout from high gas prices than to bring down fuel costs.

“Don’t go home and tell your constituents you did anything for them. In truth, you haven’t,” said Rep. James P. McGovern (D-Mass.).

The bill faces an uncertain fate in the Senate, where lawmakers are drafting their own proposals, including offering tax breaks to encourage refinery construction and expansion.

The House-passed Gasoline for America’s Security Act would direct the president to designate sites, including former military bases, for new refineries and streamline the issuance of permits.

The bill would limit the different gasoline blends produced to meet clean-air rules, an effort to make it easier to move fuel from one region to another during supply shortages. In addition, it would require the Federal Trade Commission to investigate price-gouging after a disaster and give the agency authority to impose fines of up to $11,000 per violation.

The measure is among a raft of energy-related bills that have shot to the top of the congressional agenda since Hurricane Katrina knocked out refineries in the Gulf Coast region, where about half the U.S. refining capacity is located. The loss of those refineries has driven up gas prices, focused attention on the vulnerability of the nation’s energy infrastructure and caused political headaches on Capitol Hill.

President Bush praised the House action and urged Congress to “continue to promote sound energy policy to help keep prices down for small businesses and hard-working American families.”

“We want to do something that shows the average American who is paying $3 a gallon for gasoline that help is on the way,” said Rep. Joe L. Barton (R-Texas), the bill’s chief sponsor.

Environmentalists accused the bill’s sponsors of attempting to exploit the hurricanes to advance initiatives long sought by the energy industry that did not get into the energy bill that Bush signed this year.

Votes are expected in coming weeks on whether to relax a decades-old federal ban on new offshore drilling for oil and natural gas and to open a portion of Alaska’s Arctic National Wildlife Refuge to energy exploration.

As a sign of the bill’s difficult prospects in the Senate, House Republican leaders were forced to scramble just to get enough votes from their own caucus. The long roll call was reminiscent of the November 2003 vote on the Medicare prescription drug benefit, when House leaders had to extend the vote for three hours in the middle of the night while Bush and GOP leaders twisted arms.

The California delegation split along party lines, with all Democrats opposed and all Republicans in favor, with the exception of Republican Ed Royce of Fullerton, who did not vote.

Rep. C.W. “Bill” Young (R-Fla.), who was skeptical that the bill would do anything to increase fuel supplies or bring down prices, voted for the measure after House Speaker J. Dennis Hastert (R-Ill.) appealed to him on the House floor to change his position.

A spokesman for Rep. Jim Gerlach (R-Pa.), who initially voted no, explained that his boss changed his vote after House GOP leaders pledged to eventually strip the bill of a provision that would make federal funds available to compensate oil and gas companies for “unforeseen regulatory or litigation delays” to refinery projects.

In his effort to ensure passage, Barton, chairman of the House Energy and Commerce Committee, dropped a provision that would have eased a requirement for companies to install anti-pollution equipment when making changes to refineries and power plants. But environmentalists and their congressional allies still objected to the bill.

“Hurricane Barton has gone from a Category 5 to a Category 3. But it is still a disaster,” said Frank O’Donnell of Clean Air Watch. And even with that provision gone, said Rep. Sherwood Boehlert of New York, one of 13 Republican opponents, the bill will still “weaken environmental laws, interfere with states’ prerogatives and give undue aid to oil companies.”

The bill would also direct the Department of Energy to establish a program to promote carpooling and create a $2.5-million ad campaign to alert drivers to gas-saving techniques. Critics have scoffed at these measures as weak and called on Congress to mandate tougher miles-per-gallon rules for vehicles.

“Perhaps worst of all, the bill still does virtually nothing to limit the nation’s growing demand for oil -- the core cause of price spikes,” Boehlert said.

Whether the legislation will be enough to cause the building of the first U.S. refinery in 30 years is uncertain. Currently, the nation’s 148 refineries operate near capacity, producing about 17 million barrels of crude oil a day -- about 4 million barrels short of the nation’s daily consumption.

Rep. Rick Boucher (D-Va.), a senior member of the Energy and Commerce Committee, expressed skepticism that the bill would lead to refinery construction, contending that refiners are reluctant to build facilities “since they’re enjoying record profits under the current regime.”

No refinery has been built in the United States since 1976.

In a letter to lawmakers opposing the bill, the National League of Cities, the U.S. Conference of Mayors, the National Assn. of Counties and the National Conference of State Legislatures contended that the legislation would “preempt state and local government authority to site and permit oil refineries.”

Bob Slaughter, president of the National Petrochemical and Refiners Assn., recently told a congressional hearing that “economic, public policy and political considerations, including siting costs, environmental requirements, a history of low refining-industry profitability and, significantly, ‘not in my back yard’ public attitudes” would make any new construction difficult.