[Congressional Record (Bound Edition), Volume 149 (2003), Part 10]
[Senate]
[Pages 13410-13418]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  ENERGY POLICY ACT OF 2003--Continued

  Mr. TALENT. Mr. President, I want to speak briefly on the renewable 
fuels standard that is the subject of the Frist-Daschle amendment, and 
specifically with regard to a report released today by the National 
Corn Growers which contains yet another round of good news regarding 
ethanol.
  For decades, those of us who care about energy in the United States 
and care about energy independence, who care about jobs and the 
creation of jobs, who care about the future and how we are going to 
have enough energy for this economy to expand throughout the 21st 
century have looked for alternative sources of energy. The Energy bill 
we are debating is a great pro-growth, pro-jobs Energy bill across the 
board. It encourages the production of traditional forms of energy, and 
it should. It encourages the production of oil and natural gas and 
nuclear energy. I support all of that. I think most of us in this 
Senate do. But all of us are concerned about the fact that the 
traditional forms of energy tend to be nonrenewable. There is a point 
at which we are in danger of running out. We import a lot of oil from 
foreign countries. About 59 percent of what we use in the United States 
we import.
  We have all wanted and have talked about for decades the possibility 
of renewable sources of energy, particularly that we can make here. I 
go around Missouri and I talk with our corn growers and other 
agricultural producers about what a great day it will be when we can 
grow our own fuel effectively and when we don't have to worry about 
running out and being dependent on other countries.
  As the Frist-Daschle amendment indicates, that day, if it is not 
here, is fast approaching. We are close to being able to grow our own 
fuel. That fuel is ethanol. It is a great day when that means more jobs 
for America. It will mean a greater measure of energy independence for 
our country and a greater measure of energy security for our country. 
It will mean support for and new markets for our family farmers and our 
agricultural producers. It is a good thing.
  I am glad Senator Frist and Senator Daschle have offered this 
amendment. I am a strong supporter of it. In fact, I am a cosponsor of 
it. I am proud of the fact that ethanol will be the subject of one of 
the first genuine bipartisan efforts in this country, and I hope that 
amendment passes.
  The Corn Growers issued a report today designed to rebut some of the 
concerns that people have expressed. It is kind of ironic that we are 
now approaching this day when we actually have access to renewable 
sources of energy and alternative fuels. And some are getting nervous 
about it. Their report issued today indicates what common sense already 
tells us.
  First of all, blending ethanol with gasoline at a 10-percent level, 
which is what the renewable fuels standard calls for, will reduce the 
retail price of conventional gas by 5 percent or 6.6 cents per gallon 
based on national average 2002 prices. This translates into an annual 
savings to consumers of $3.3 billion. The report says that. They have 
studied it for a long time. It really is a matter of common sense 
because when you increase the supply, the price goes down. The more 
ethanol we produce, the more we can rely on renewable sources we can 
grow and the greater the supply of energy.
  The report also indicated that using corn and other grains to produce 
the 5 billion gallons of ethanol required by the renewable fuels 
standard will have an insignificant impact on consumer food prices.
  In other words, the price of corn and other items is not going to go 
up because we have tremendous productive capacity in this country. As a 
matter of fact, we are not using the capacity we have. As a matter of 
fact, the price to consumers is going to go down because as our 
producers are able to grow corn and turn it into a value-added 
commodity, a valuable commodity, ethanol, the price of future farm 
bills is going to go down.
  I was impressed very much when I was in Macon, MO, visiting our 
ethanol plant there. One of the producers who owns that plant pulled me 
aside and said: Senator Talent, the real good thing about this is when 
the price of corn goes down, I make more money on the ethanol.
  I thought to myself: Yes, that is one of the keys to ethanol. It will 
help smooth out some of the cycles of commodity prices, the ups and 
downs of commodity prices worldwide, which will mean that farm bills 
will become less challenging every 5 years. It will also mean more 
money for the transportation trust fund once we have adopted the tax 
changes that the Finance Committee has worked out and which will 
accompany or follow shortly after this Energy bill.
  It is a good thing for America. It is a good thing for our producers. 
It is a good thing for the creation of jobs.
  I am glad this amendment is being offered. I want to address briefly 
the amendment of the Senator from California. I know it is an amendment 
offered in good faith. It is an amendment to exempt California from the 
renewable fuels standard. It is a little hard for me to understand 
because the standard is not a mandate for the States. It is a mandate 
for the refineries. They have to have 5 billion gallons of ethanol 
refined and into circulation by the year 2012. That should not be 
difficult.
  The use of ethanol is growing all over the country, precisely because 
of the

[[Page 13411]]

advantages it offers, which I have outlined. Exempting States doesn't 
make any sense. California is already using ethanol. By this summer, 60 
to 70 percent of the gasoline sold in California will be an ethanol 
blend.
  I suspect that maybe States such as California think: we don't 
produce ethanol here; we don't want to have to import energy from other 
States. If you do not import energy from other States, and if you do 
not import ethanol from other States, you are going to have to import 
something from someplace in order to run the automobiles. I would a 
whole heck of a lot rather have States in this country importing 
ethanol, which is good for the environment and jobs in the United 
States, from other States in the U.S. than the alternative, which is to 
import gasoline, which is not as good for the environment and which 
does not mean jobs for our country, from Venezuela or from the Arab 
States or from some other place in the world. They are taking one of 
the tremendous virtues of the renewable fuels standard and trying to 
turn it into a vice.
  It will reduce our dependence on foreign countries.
  There is really no danger to the United States being dependent on 
fuel that we produce in the United States. It is a good thing to be 
dependent on fuel we produce in Missouri or Minnesota or North Dakota 
or South Dakota or Illinois or any of the number of States that produce 
ethanol.
  I understand the uneasiness. The use of ethanol is growing very fast. 
Its future is coming on us very fast. Sometimes change is difficult to 
deal with. I was in a Breaktime convenience store in Columbia, MO, 
where they are selling ethanol at the pump for the same price they have 
traditionally sold gasoline. I went to this place, stood out next to 
the pump, talked to the proprietors, and said: This is the future. It 
is a good future. It is a national future for the United States. This 
is a national energy policy. We have one Union, not just 50 different 
States. We have one national economy, and we ought to have one 
renewable fuels standard for everybody, and we ought to have confidence 
in it.
  I think this 5-billion-gallon standard will be very easily attained. 
I think we will be above that. States all over the country and 
consumers all over the country are using ethanol to their benefit and 
to the benefit of the Nation as a whole. This is a pro-jobs, pro-growth 
Energy bill, and the Frist-Daschle amendment is a very important pro-
jobs, pro-growth, pro-energy security and independence part of it.
  Let's adopt that amendment. We do not need these weakening 
amendments. Let's face the future with confidence. One of the reasons 
we can do that is because the Nation will increasingly rely on fuel 
that we produce in this country in the 50 States.
  I thank the Senate for its attention, Mr. President, and I yield the 
floor.
  Mr. REID. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant bill clerk proceeded to call the roll.
  Mr. KYL. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Crapo). Without objection, it is so 
ordered.
  Mr. KYL. Mr. President, at this point I want to talk to the general 
subject of the two second-degree amendments offered by the Senator from 
California which will be pending for us to vote on later this 
afternoon. They both have to do with the requirement under the 
underlying amendment to impose an ethanol requirement for gasoline 
throughout the country and to not allow States to opt in or opt out of 
that mandated ethanol requirement.
  One of the amendments by the Senator from California is to allow an 
opt-in, so that States that believe this will help them deal with their 
problems of ozone and the environment or other environmental pollution 
can opt into this program and take advantage of it; but for those 
States that believe it would be harmful to their environment, they 
would not have to opt in. The other amendment would require findings 
with respect to whether or not it would help the environment.
  I want to comment about that because the State of Arizona is one of 
the States that would be adversely affected by a requirement to use 
ethanol. Partly, this is as a result of the fact that the climate in 
Arizona is very warm, shall we say, particularly in the summertime. Our 
summer runs essentially from April through October. During that period 
of time, ethanol does not work well in communities such as Yuma, AZ, 
and Tucson, AZ, because of the way it interacts with the surrounding 
hot air, and the product that is produced, the moisture from the 
tailpipe of the automobile, interacts with the air to in fact produce 
ozone, which is the very thing we are trying to prevent by the use of 
oxygenated fuel. As a result, Arizona has used an MTBE substitute 
oxygenate that doesn't create the same problem ethanol creates in the 
hot environs of the climates in Yuma or Tucson, AZ.
  As you know, MTBE is associated with some environmental damage to 
aquifers, where MTBE has spilled into them inadvertently and, as a 
result, MTBE is being phased out.
  Arizona receives all of its gasoline from refineries in California. 
Therefore, decisions California makes pretty well impact on what 
Arizona has available to it for its vehicle use. This is why, 
naturally, the points of the Senator from California are exactly the 
points I make, because they apply to the refineries in her State and 
the same kinds of climatological requirement that my State of Arizona 
has with respect to environmental protection.
  So let me refer to several points with respect to the ethanol mandate 
and begin with that point of environmental impact. Ethanol is an 
extremely volatile fuel. It breaks down very quickly. In fact, it is 
virtually impossible to transport by pipeline because of this. It has 
to be transported by truck. Obviously, it is not produced in the West, 
in States like Arizona. It would have to be trucked in from other 
places such as the Midwest. This adds to the cost of the fuel, but that 
is another matter. Ethanol has been used as an additive in gasoline 
sold in the Phoenix and Tucson areas. But according to the Arizona 
Department of Environmental Quality, the State agency of the State of 
Arizona that is responsible for environmental protection in the State 
of Arizona, this mandate would be very bad for communities, as I said, 
like Yuma and Tucson, probably causing those areas to violate the 8-
hour ozone standard under the Clean Air Act. This would have dramatic 
effects in Arizona. Those communities would be out of compliance.
  There are a whole host of economic negative effects from finding a 
violation of the ozone standard. How can it be that the use of an 
oxygenate such as this would create more ozone? Because of the unique 
climate in Arizona in the summertime where, instead of reducing the 
amount of ozone particulate, it increases it.
  Given the fact that there is no evidence that the use of oxygenates 
like ethanol would help improve the quality of air in Arizona, it seems 
to me a finding from the Arizona Department of Environmental Quality 
that says Arizona communities would likely violate the 8-hour ozone 
standard by being forced to use ethanol is a very powerful argument for 
the Governor of the State of Arizona having the option of opting into 
this program.
  Why would the other States force on Arizona a program which our own 
Department of Environmental Quality says is going to make the air 
worse, not better--in fact, so much worse it will be in violation of 
the Clean Air Act? It is not as if the committee and the proponents of 
the underlying amendment have not understood that the mandate should 
not apply to all States. In fact, two States are specifically 
exempted--Hawaii and Alaska--from this mandate.
  Why, if it is appropriate to exempt two States, is it not appropriate 
to at least afford other States the option of submitting themselves to 
this mandate or not, depending upon whether this mandate would make 
their air quality worse or better? It seems to me if we

[[Page 13412]]

are really talking about environmental quality here, rather than a 
subsidy for the corn industry in the Midwest, then we would be looking 
at the environmental impact of a mandate of this sort. Since we have 
already decided that two States should not be required to comply with 
this mandate, we have already crossed the bridge of saying it is 
appropriate to exempt some States. Why not allow those States, with 
their departments of environmental quality having said they would be 
harmed, the ability to opt out, or the requirement that they opt in, in 
order for the program to be effective in the State? Why not allow that 
option for those States? What is so important about this mandate that 
every single State, except two--and I don't know why these two were 
exempted--is not at least given the opportunity to exempt itself from 
the provision?
  It seems to me there has to be something else involved here. I 
suspect it has to do with the desire of the corn producers and the 
people who transform the corn into an ethanol kind of product to make a 
buck. But we already provide them a lot of bucks through the subsidy 
for ethanol that has already been voted on by the Congress, has already 
been in existence for many years, and which will increase in this bill. 
I could understand--I would not agree with it--a subsidy to try to 
produce more of something we think we want to produce. Even though I 
don't think that is a good idea, I could at least understand the theory 
that if we want more of something, we are going to have the Government 
provide a subsidy to produce more of it. I could also understand the 
alternative, which would be that this is such a good idea that we are 
going to force people to do it; we are going to mandate it because we 
in Washington know best, of course, and therefore irrespective of what 
the environmental quality people in your own State believe, by golly, 
we know better, so we are going to make them do it.
  What is a little hard for me to understand is why we still need the 
subsidies if we are going to have this mandate. The purpose of the 
subsidies was to try to encourage this production, but we do not need 
the subsidies if people are going to be required to use ethanol. It is 
a mandate. We do not need the incentive or the encouragement anymore.
  Clearly, this is about special interest money influence, and I will 
be that specific because the environmental benefits, especially to an 
area such as mine, have not been demonstrated. At least the point is 
made by an agency of my State that it would actually degrade the air 
quality of some parts of the State--in fact, pull them out of 
compliance with the Clean Air Act, and yet the mandate would be imposed 
at the same time we continue to provide this subsidy. Something is 
drastically amiss here.
  There is an old phrase, ``Follow the money,'' so maybe that is what 
we should do here. Let's take a look at the money part of this issue.
  Currently, refiners use approximately 1.7 billion gallons of ethanol 
annually, and the underlying provision would increase that to 5 billion 
gallons annually by the year 2012.
  There is no question that gasoline prices would increase, based on 
data from the Energy Information Administration. It has been estimated 
that the increase in gas prices caused by this mandate could be between 
$6.7 billion and $8 billion a year. So that is the price we as a 
country, as consumers of this product, will be paying simply to enrich 
the people who produce the product.
  Arizonans will, according to this estimate, be paying on average 7.6 
cents more per gallon of gas. Is that fair, Mr. President?
  I speak very plainly about the subsidies to the ethanol industry. 
According to the Congressional Research Service--this is an unbiased 
source--the ethanol and corn industries have received more than $29 
billion in subsidies since 1996 and could receive another $26 billion 
more over the next 5 years.
  CBO, another unbiased source, has a different estimate for a 
different time period. They have estimated, based on a review of S. 
791, the basis of the underlying amendment we are debating, $2.3 
billion just between the years 2004 and 2008.
  We also know there is an impact on the highway trust fund because 
every gallon of gas containing ethanol--10-percent blend--gets a 5.3-
cent subsidy in the form of reduced gas taxes. This amounts to a 53-
cent-per-gallon ethanol subsidy to the industry at the expense of the 
highway trust fund, and the Energy Information Administration has 
estimated that this will reduce the annual gasoline excise tax 
collections by an average of $892 million between the years 2006 and 
2020.
  Again, my State is a donor State already. Arizonans send $1 in taxes 
to the Federal Government and for highway transportation-related needs 
receives in return only 90.5 cents. So to the extent total revenues to 
the fund are reduced, the Arizona highway program will obviously be 
significantly impacted.
  There are a lot of general points that I could discuss. There are 
disputes between authorities on the subject of whether or not it takes 
more to produce a gallon of ethanol than the gallon actually contains 
in terms of Btu content; in other words, do you actually have a net 
loss in net energy value. There are disputes about that. Some experts 
say about 29 percent more energy is used to produce a gallon of ethanol 
than the energy in a gallon of ethanol. The National Corn Growers 
Association, not exactly an unbiased source, disagrees with that. I do 
not know where the truth lies. Clearly, it seems to me the science is 
at best in dispute.
  In any event, we would all have to agree that taking into account all 
costs, not just the energy cost, that clearly it costs a great deal to 
produce a gallon of ethanol or they would not need the subsidy which 
Congress has generously provided for its production.
  I have already talked about the environmental benefits being 
questionable. It is not just my own State environmental agency but also 
a National Research Council report found that oxygenates have little or 
no impact on ozone formation, and there are a lot of refineries that 
claim they can actually produce similar environmental gains without the 
use of oxygenates. In fact, that is what we are going to have to do in 
Arizona because we cannot use MTBE, and we would hope not to have to 
use the ethanol, as a result of which we would have to find a different 
blend and would be committed to doing that.
  It seems to me the ethanol industry, which enjoys this 5.2-cent-per-
gallon exemption on the ethanol blend, or gasohol, from the 18.4-cents-
per-gallon Federal excise tax on motor fuels, with the resulting 
mandate that the Congress is going to impose for the increase in the 
number of gallons used, would no longer need to be supported by this 
subsidy, which, as I said, works out to be 52 to 53 cents per gallon 
for pure ethanol.
  The General Accounting Office estimates the tax exemption has 
deprived the highway trust fund--a slightly different number than I 
gave before--of between $7.5 billion and $11 billion over the 22 years 
it has been in place. This is a very costly subsidy and would be a very 
costly mandate.
  Because the underlying amendment is costly, is not necessary, is 
contradictory with the subsidies that are already provided, and because 
the amendment of the Senator from California would simply provide the 
opportunity for States that would be adversely affected by this mandate 
to deal with their pollution problems in some other way--remember, they 
still have to comply with the Clean Air Act; nobody is exempting 
anybody from the Clean Air Act; they simply have to find a different 
way to comply--it seems to me it would be appropriate for us to support 
the amendment of the Senator from California and allow States to tailor 
their blends to the unique situation in their particular States.
  Everybody would still have to meet the Clean Air Act but we could 
each do so in a way that best suits our individual purposes. For that 
reason, I hope my colleagues will support the amendment of the Senator 
from California.

[[Page 13413]]

  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, I ask unanimous consent to address the 
Senate as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. McCAIN are printed in today's Record under 
``Morning Business.'')
  The PRESIDING OFFICER. The Senator from Ohio.
  Mr. VOINOVICH. Mr. President, I rise to speak on behalf of the 
ethanol amendment and to comment upon several of the remarks that were 
made by my colleagues.
  One of the items that was mentioned by the junior Senator from 
Arizona was the issue of subsidy. I think it is important we clarify 
the fact that, yes, ethanol has been subsidized over the years, but the 
Federal ethanol program was established following the OPEC oil 
embargoes of the 1970s.
  I am old enough to remember the long lines in 1973. At that stage of 
the game, we were only about 34 percent reliant on foreign oil. Of 
course, we all know today we are 58 percent reliant on foreign oil.
  So when the ethanol subsidy came in place and the program was 
established, we had a dangerous dependence on imported oil. That was 
one of the reasons they did it. As an alternative to petroleum, ethanol 
directly displaces imported oil and reduces tailpipe emissions while 
helping to bolster the domestic economy. Yet today, as I just said, we 
import more petroleum than ever before with rising crude oil prices and 
increasing international instability.
  Incentives for production and use of domestic ethanol are critical; 
that is, we can rely upon ethanol. We cannot rely upon imported oil.
  I think it is really important for all of us to recognize the fact 
that we have subsidized the oil industry substantially since the early 
1900s. Some may not believe this, but the oil industry started out in 
the State of Ohio. It was called Standard Oil. Today we continue to 
subsidize the oil industry. In fact, according to the General 
Accounting Office, in an October 2000 report, the oil industry has 
received over $130 billion in tax incentives just in the past 30 years, 
dwarfing the roughly $11 billion provided for renewable fuels.
  Here is an interesting fact: During this time, the U.S. oil 
production has plummeted while annual U.S. ethanol production has grown 
by over 2 billion gallons. The point is, when we got into the issue of 
subsidizing ethanol, we were in very bad shape in terms of our reliance 
on foreign oil. Since that time, we have made substantial progress.
  During the same period of time, if you want to pit one industry over 
the other, we have seen our dependence on foreign oil grow despite the 
subsidy we have provided to the oil industry.
  There is also the suggestion that the ethanol mandate will largely 
benefit producers, not farmers. According to the U.S. Department of 
Agriculture, ethanol production raises the price of corn by 30 to 50 
percent nationwide. This is an average of 5 to 10 cents additional 
premium in the areas that supply ethanol plants. Both of these numbers 
apply to all corn, not just corn sold to ethanol plants. Given a 
billion bushel corn crop, it adds between $3 and $5 billion to farm 
income every year. There is no question, ethanol is good for our 
farmers. Additionally, farmers own nearly 40 percent of the ethanol 
industry, and that is growing. These farmer owners realize value-added 
benefits from their investments.
  A chart was referenced by the Senator from California about the fact 
we are relying on Archer Daniels Midland for 46 percent of our ethanol. 
The fact is it is now down to 32 percent. The real growth in producing 
ethanol is from ethanol plants financed by the agricultural community 
in the United States.
  Finally, every major farm organization supports the fuels agreement, 
including, but not limited to, the following: American Farm Bureau 
Federation, the National Farmers Union, National Corn Growers 
Association, American Corn Growers, National Grain Sorghum Producers 
and American Soybean Association.
  Now, we have some concern about what impact does this industry have 
on the National Treasury, our general fund. Both the U.S. Department of 
Agriculture and the Congressional Budget Office have recognized the 
benefit of the investment in the ethanol program on the overall health 
of the Nation's economy. Recently, the USDA stated the ethanol program 
would decrease farm program payments by $3 billion per year. In its 
analysis of this amendment, CBO stated the provision would reduce 
direct spending by $2 billion during 2005 to 2013, certainly a partial 
offset to any subsidy given to the ethanol industry.
  Tripling the use of renewable fuels over the next decade will reduce 
our national trade deficit by $34 billion. Our trade deficit is at an 
all-time high. A lot of that trade deficit has to do with importing 
oil. It will increase the U.S. gross domestic product by $156 billion 
by 2012 and create more than 214,000 new jobs. It will expand household 
income by an additional $51.7 billion, and it will save taxpayers $2 
billion annually in reduced government subsidies due to the creation of 
new markets for corn.
  We see a tremendous economic benefit to this ethanol industry in our 
country. That is why we are working so hard to have this amendment 
included in the Energy bill.
  In addition to its importance in becoming more self-reliant in terms 
of imported oil, also in terms of our economy, ethanol helps our 
environment. This bill provides strong anti-
backsliding provisions that prohibit refiners from producing gasoline 
that increases emissions. Once the oxygenate requirements are removed, 
a Governor can also petition EPA for a waiver of the ethanol 
requirement based on supporting documentation that the ethanol waiver 
will increase emissions that contribute to air pollution in an area of 
the State. This is something that was not mentioned by the junior 
Senator from Arizona in his presentation. The fact is, if ethanol is 
such a big environmental problem in the State of Arizona, the Governor 
of Arizona can petition that they be exempt from the mandate provision. 
That is included in our amendment.
  Last year, the ethanol industry also worked with EPA on the discovery 
and containment of the emissions from ethanol facilities. Consent 
decrees have been filed by the Justice Department in record time, and 
compliance by the ethanol industry has been cited as a model.
  The fuels agreement we are asking Members to support will benefit the 
environment in a number of ways. It reduces tailpipe emission of carbon 
monoxide, VOCs, and fine particulates, and phases down MTBE over 4 
years to address our ground water contamination problem. It provides 
for one grade of summertime Federal RFG, which is more stringent. It 
increases the benefits from the Federal RFG program on air toxin 
reduction. It provides States in the ozone transport region enhanced 
opportunity to participate in the RFG program. And it includes 
provisions that require EPA to conduct a study of the effects on public 
health, air quality, and water resources of increased use of MTBEs. We 
have tried to cover everything in this amendment.
  The amendments to opt out of this program are unnecessary and 
unwarranted.
  The fuels agreement contained in this amendment that passed the 
Senate last year includes the establishment of a renewable fuel 
standard and will provide for greater refinery flexibility in the fuels 
marketplace than the existing Clean Air Act oxygenate requirement. It 
does not require that a single gallon of renewable fuels be used in any 
particular State or region; rather, the requirement is on the refiners. 
The RFS will allow much greater flexibility in the work of oxygenates, 
which should reduce the chances that localized supply disruption of 
gasoline or oxygenates will result in retail supply shortages.
  The additional flexibility provided by the RFS credit trading 
provisions will be a lower cost to refiners and, thus, consumers. The 
credit trading system will ensure that renewable fuels are used when 
and where most cost effective, which is why we have the credit

[[Page 13414]]

and trading provisions. In California, we need to emphasize this.
  By the way, California is the area where the junior Senator from 
Arizona says they are going to have to rely upon getting their ethanol 
blend gasoline. Nearly all the refiners, the people who provide the 
gasoline to the State of Arizona, have switched from MTBE to ethanol in 
advance of the State's MTBE phaseout deadline of January 1. The results 
can only be described as seamless. There have been no ethanol 
shortages, transportation delays, or logistical problems associated 
with the increased use of ethanol in the State of California. In fact, 
according to an April 2003 California Energy Commission report, the 
transition to ethanol which began in January 2003 ``is progressing 
without any major problems.''
  We need to emphasize that. This is not going to discombobulate 
delivery of the gasoline in California or New York or other places that 
people say it will cause a problem. The Energy Commission of California 
says it is progressing without any major problems. Today, approximately 
65 percent of all California gasoline is blended with ethanol. It is 
estimated that 80 percent of the fuel will contain ethanol by this 
summer. They are moving ahead. Only 100 million gallons of ethanol were 
used in the State last year. California refiners will use between 600 
and 700 million gallons of ethanol in 2003. There is not any reason to 
opt out because of the fact that blended gasoline will not be available 
to these States.
  This legislation is the result of a great deal of work and compromise 
on the part of many Members of the Senate working with a variety of 
organizations.
  I would like to remind my colleagues of the organizations that 
support this. It is unusual, in terms of the diverse groups 
represented. It is supported by the American Petroleum Institute. There 
has been some talk that the oil industry does not support it. The fact 
is, the American Petroleum Institute is supportive; of course, the 
Renewable Fuels Association; the Northeast States for Coordinated Air 
Use Management. Again, there is an area of the country that could be 
affected by it, and they like the compromise that has been put 
together.
  We are talking about environmental concerns. The American Lung 
Association is supportive of this ethanol amendment. The U.S. Chamber 
of Commerce is certainly concerned about the impact this would have on 
the economy of the United States. The Union of Concerned Scientists, 
again, a very forthright, outspoken environmental organization that, on 
many occasions, is very critical of legislation being promoted in the 
Senate, says: We like this agreement that has been entered into.
  The Environmental and Energy Studies Institute; the Governors' 
Ethanol Coalition; General Motors. Here is one that I think is really 
important for some of my colleagues who cannot make up their mind with 
regard to some of the amendments we are going to get to this ethanol 
amendment, and that is that the Governors of both California and New 
York support this compromise, and, of course, all the major 
agricultural organizations in the United States.
  I urge my colleagues to support this ethanol amendment and defeat 
some of the amendments that they are going to have an opportunity to 
vote on later on this afternoon.
  The PRESIDING OFFICER. The Senator from Arkansas.
  Mrs. LINCOLN. Mr. President, first, I compliment my colleagues, the 
chairman and ranking member of the Energy Committee, for doing such an 
incredible job on an Energy bill that is so needed in this great 
country. For the last 25 years, I think we have really begun to see the 
growth in our Nation and recognized the need for a modernization of our 
energy policy in this country. I think these Senators have done an 
excellent job in bringing together a diversity of issues, certainly in 
recognizing the need for renewable fuels, in looking at how we can work 
with cleaner burning fuels, the diversity of energy sources and 
resources that we can use in this great Nation. I applaud them for 
their hard work and diligence in that.
  It is so important in our State. In Arkansas, both as a consumer as 
well as producer of energy, and certainly in terms of the rural nature 
of our State, so much of what is in this bill is going to be very 
productive for what we want to see happening, not only in the State of 
Arkansas but across this great Nation in new and innovative energy 
policy.


                  Unanimous Consent Request--H.R. 1308

  Mrs. LINCOLN. Mr. President, I also would like to talk about 
something that has been on the minds of many of my colleagues as well 
as others across this great land. After we finished the growth package 
the week before we took our break, I had many concerns about what we 
were doing in that growth package and what we were trying to do, what 
supposedly was our objective in terms of stimulating the economy. I 
think it is so important to recognize the reasons why we wanted to 
stimulate our economy in this country. I think that really is to move 
forward the growth of this great Nation.
  I think we need look no further than the American family if we want 
to understand why we want to stimulate growth in this great Nation to 
stimulate the economy. That is why I introduced the Working Taxpayer 
Fairness Restoration Act. I offered this bill on behalf of nearly 12 
million children who were left behind when President Bush signed the 
2003 tax bill. There were many of us who were very anxious to make sure 
we had a fairness in that stimulus package and in that tax bill; that 
there was a balance between fiscal responsibility and tax relief that 
would be available to all families.
  I have introduced the bill with many of my good friends, including 
Senators Snowe, Warner, Jeffords, Rockefeller, Collins, Reed, Bingaman, 
Landrieu, Johnson, Harkin, Kennedy, Pryor, Breaux, Edwards, Clinton, 
Corzine, Durbin, Sarbanes, Kerry, Lieberman, Schumer, Lautenberg, 
Mikulski, Reid, Graham of Florida, Baucus, Leahy, Nelson of Florida, 
Nelson of Nebraska, Levin, Carper, Hollings, Biden, Specter, Cantwell, 
Daschle, Stabenow, Dodd, Conrad, Voinovich, Akaka, Dorgan, Kohl, 
Chafee, Feinstein, and Boxer.
  This bill would restore a provision left on the cutting room floor 
when the House and Senate leaders finalized the conference report on 
the tax cut.
  Our bill will restore the advanced refundability of the child tax 
credit. My friend from Maine, Senator Olympia Snowe, and I have worked 
since 2001 to ensure all working families benefit from the child tax 
credit. We worked very hard to ensure in the 2001 tax cut that the 
child tax credit was refundable.
  During the Finance Committee deliberations on this year's tax bill, I 
successfully offered an amendment that would have advanced the 
refundability of the child tax credit. Regrettably, that provision was 
dropped in conference.
  Really, unless we pass this bill we have introduced soon, families 
with incomes between $10,500 and $26,625 will not get that $400 check 
that will be mailed in July as part of the 2003 tax bill. Since nearly 
half of the taxpayers in Arkansas have an adjusted gross income of less 
than $20,000, Arkansas families are among the hardest hit by this 
omission in the new tax law.
  Consider this: The base pay for a private in the military, serving in 
Iraq, is just under $16,000 per year. The average Arkansas firefighter 
makes between $22,000 and $25,000 a year. Many of those enlisted men 
and women, who could be given a few days' notice before being shipped 
off to war, and those firefighters who could get no more than just a 
few minutes' notice before rushing into a terrorist attack--they all 
have families, or many of them do. They work hard to support their 
families and to protect us. Yet they got left out when negotiators 
shook hands over that final tax bill.
  I was not in the room during those negotiations in the dark of night, 
and I understand very few of my colleagues were. But we are here today. 
We are all here in the Senate, working today, united, hopefully, in our 
effort to fight for these working families.
  Advancing the refundable portion of the child credit to cover these 
families

[[Page 13415]]

will cost only $3.5 billion--just 1 percent of the entire cost of that 
tax bill. This measure had strong bipartisan support in the Senate, I 
am proud to say. I was proud to play a leading role to expand the child 
tax credit in the Senate bill. I am glad to have bipartisan support in 
my efforts on the bill that we have introduced to restore this 
provision.
  We will pay for this tax relief for working families by shutting down 
some of the Enron-related tax shelters. This pay-for was included in 
the Senate version of the 2003 tax bill that has already received the 
blessing of the majority of the Senate Members. Especially as our 
Nation contends with a sluggish economy, we should ensure that everyone 
benefits from the tax cut. After all, buying blue jeans for 
schoolchildren, washing powder for the laundry, or tires for the car 
costs just as much for a family making $20,000 a year as it does for a 
family making $100,000 a year. If we want to get our economy back on 
track, we need to make sure we are putting money into the pockets of 
consumers who will spend it.
  This is not about partisanship. It is not about who is going to win 
here or lose here today or in the next coming days. That is certainly 
evidenced by the cosponsorship of this bill. What this is about is 
doing what is right for the families who may need a little extra help, 
families who are working hard, day in and day out, playing by the 
rules, bringing home a paycheck and trying to raise their children the 
best way they know how: with good values and good examples.
  We should fix this problem--not in the future, not next year, not 
sometime down the road. We need to fix this and correct this 
inconsistency immediately. We have an opportunity to do what is right 
on behalf of the working men and women in this country who are working 
hard, creating a face for this Nation in the next 20 years.
  What is our Nation going to look like in the next 20 years? What are 
the values of the leaders of tomorrow? These faces and these values are 
in the children we are raising today. It is not too much for this body, 
or the coequal body of the House, to say the time is right, to put our 
money where our mouth is, to give these hard-working families the 
opportunity to get a little extra--a little extra of the incredible 
amount they pay into the system, a little bit extra to raise those 
children the best way they know how.
  I started by saying the initiative to stimulate the economy in this 
country was an initiative, I think, based on what we all wanted to 
achieve: Not just to stimulate the economy but to strengthen our 
Nation. And, once again, we have the opportunity, and we need to look 
no further than the faces of our children and the workers of the 
American family in order to be able to do that.
  Let us make these American families our priority today.
  I ask unanimous consent that the Senate proceed to calendar No. 52, 
H.R. 1308, a bill to amend the Internal Revenue Code of 1986 to end 
certain abusive tax practices; that the Lincoln substitute amendment, 
which is at the desk and is a modified version of S. 1162, a bill to 
amend the Internal Revenue Code of 1986 to accelerate the increase in 
the refundability of the child tax credit, be considered and agreed to; 
that the bill H.R. 1308, as amended, be read three times, passed, and 
the motion to reconsider be laid upon the table, without intervening 
action or debate, on behalf of working American families.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, reserving the right to object, I ask 
unanimous consent that the request be modified so that all after the 
enacting clause of H.R. 1308 be stricken, and the text of the Grassley 
amendment regarding the child tax credit be inserted in lieu thereof; 
provided further that the bill then be read a third time and passed and 
the motion to reconsider laid upon the table.
  Mrs. LINCOLN. Mr. President, with all due respect to my colleague, I 
reserve the right to object.
  The PRESIDING OFFICER. Is there objection?
  Mrs. LINCOLN. Yes. I object.
  I would like to comment. I think I know what the chairman is doing. I 
would like to comment that we did provide pay-for in our bill. My 
concern for what he has offered is that it is going to add another $90 
billion or $80 billion to unpaid debt in this country, for which I 
don't believe there is a pay-for.
  I respectfully object.
  The PRESIDING OFFICER. Objection is heard to the modification.
  Is there objection to the request?
  Mr. DOMENICI. I object.
  The PRESIDING OFFICER. Objection is heard.
  Mr. DOMENICI. Mr. President, I would like to state what the Grassley 
proposal is.
  It would make permanent the increase in the child tax credit. The 
bill signed by the President last week increases the credit from $600 
to $1,000 for the next 2 years. The Grassley amendment would make the 
increase permanent.
  Second, it would eliminate the marriage penalty built into the 
current child tax credit. The Grassley amendment increases the income 
phaseout for married couples filing jointly to twist the limit for 
single individuals filing alone. The Lincoln amendment fails to address 
this inequity in the current formulation of the child tax credit.
  Third, the amendment would create a uniform definition of a 
``child.'' This language is identical to the legislation introduced by 
Senators Grassley and Baucus. This change reduces from five to one the 
number of definitions of a ``child'' in the Tax Code, which will 
simplify part of the code that will directly affect working families.
  I might say to my good friend that I think she understands. I have 
the greatest respect for her. And, obviously, she makes a case today 
not only for herself but for many Senators and for many who voted with 
her in the days preceding as this legislation worked its way through 
here and through the conference in the House.
  It is the responsibility of the Senator from New Mexico to respond in 
behalf of the majority, and I have done so. In doing so, I have offered 
a counterproposal. Obviously, it is significantly different than the 
one the distinguished Senator from Arkansas offered; nonetheless, a 
very significant proposal. I thank her for her generosity.
  I yield the floor.
  Mrs. LINCOLN. Mr. President, I thank the chairman and my good friend, 
who is a diligent worker on behalf of children. I know his concern for 
the children of this country. I would like to express to him that in 
the counterproposal that has been offered, it was not my intent to look 
for an attempt or an excuse to reopen the tax package or to spend an 
additional hundred billion dollars. I simply felt very compelled--that 
with a small portion of this bill that could be rectified to make sure 
these working families in America could get the same benefit from this 
tax bill that everybody else will on July 1--to think this was an easy 
opportunity for us to do that. We had a pay-for that was reasonable and 
something that the rest of the Senate had already agreed to and that 
Senators probably felt very comfortable with. It was simply an 
opportunity to express to those families that we certainly believed 
they were a priority and that we could support them in this effort.
  I appreciate the remarks of the Senator very much. I thank the Chair.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, let me speak very briefly and indicate 
my strong support for the Senator from Arkansas and her effort.
  I think clearly we need to address this major failing of the 
previously passed tax bill, and we need to do so in a way that is 
fiscally responsible. That is exactly what the Senator from Arkansas 
has proposed--to find a way to pay for the refundability of the child 
tax credit. That is what she proposed earlier in the bill. That is what 
the Senate agreed to earlier in the bill. That is clearly what we ought 
to do at

[[Page 13416]]

this point. I regret that we were not able to do that this afternoon. 
But I hope the opportunity to do so will recur at some point in the 
near future and we can, once again, do what we believe should be done 
to try to bring more equity to that tax package which was passed and 
signed by the President.
  Mr. DOMENICI. Mr. President, it is my understanding that a vote will 
occur at 4:30; that there are 10 minutes prior thereto for debate on 
the first amendment equally divided into 5 minutes each for those 
proponents and opponents of that amendment. Is that correct?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. DOMENICI. Parliamentary inquiry: What is the title of the first 
amendment?
  The PRESIDING OFFICER. The first amendment is amendment No. 843 
offered by the Senator from California, the purpose of which is to 
offer an ethanol mandate renewable fuel program to be suspended 
temporarily if the mandate is harmful to the environment.
  Mr. DOMENICI. Mr. President, I trust the Senator from California will 
be here if she desires to debate it.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DASCHLE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Chafee). Without objection, it is so 
ordered.


                      Amendments Nos. 843 and 844

  Mr. DASCHLE. Mr. President, I know we will be voting at 4:30 on the 
Feinstein amendments. Both amendments attempt to provide waivers to the 
States from the renewable fuels standard. There are several points to 
be made. I made some of them this morning. But in case my colleagues 
have not had the opportunity to evaluate the amendments or consider the 
concerns raised by many of us with regard to the amendments, I thought 
it would be appropriate for me to say a couple of words again now.
  First of all, with regard to ethanol utilization, the State of 
California is currently using ethanol in 65 percent of all the fuel it 
is marketing within the State. That is expected to go up to 80 percent 
this summer. The Department of Energy in California has said there has 
been absolutely no difficulty in the integration of ethanol from a 
transportation point of view, a storage point of view, an environmental 
point of view, or a cost point of view.
  So that would be first. Why have a waiver when there is no problem? 
The problem does not exist. In fact, studies have shown--that I pointed 
out this morning, one by the Department of Energy Information, one by 
the Department of Energy in California--that have said there is 
absolutely no connection between increases in the price paid for 
gasoline and the use of ethanol. So from a cost point of view in 
particular, there certainly isn't any need for a waiver.
  Secondly, and perhaps far more importantly, this legislation provides 
that there is no mandate on the States. There isn't one requirement 
within the bill that says a State must use ethanol as part of its 
requirement under the law. That does not exist. The requirement is on 
refiners, not on the States. And the refiners are given wide latitude 
to make their decisions based on where it is appropriately marketable 
and not on any predesign with regard to the market itself.
  We are not dictating to any oil company that that 65 percent now 
being used in California be used as a result of a legal requirement. 
That does not exist. We are simply saying: Look, we will let the oil 
companies and the refiners make up their own minds. And with the credit 
trading system, the job is made all the easier.
  I would also say that if worse comes to worst, we have said: Look, if 
all else fails, there is absolutely no reason why a State cannot apply 
for a waiver under the new law. Senator Feinstein and others have 
suggested, well, they have applied for waivers in the past and have 
been turned down. I hasten again to add for those who may be confused 
by this, she is talking about the current law. In part, what we are 
doing now is amending the law, removing the oxygenate requirement, 
phasing out methyl tertiary butyl ether, MTBE, and providing an 
opportunity for States to get out from under requirements of the old 
law while at the same time coming up with a way with which our country 
can reduce its dependence on foreign sources, can find ways with which 
to clean up the air, and can do as much as possible to find markets for 
agricultural products within our own States and country. That is, in 
essence, what this bill provides.
  So I simply say, Mr. President, as well intended as the Senator from 
California is, there is absolutely no reason why this waiver is 
necessary. They have one in the bill. They have the credit trading 
system in the bill. There isn't any requirement for a State to mandate 
the use of ethanol in this bill.
  And, finally, it is working as we have predicted it would, certainly 
in those States where the markets have been allowed to work. 
California, as I said, now expects 80 percent of their fuel to 
incorporate ethanol through the summer. So it is yet another one of 
these constant myths that has to be destroyed and dealt with as we 
consider the many allegations about what it is we are trying to do.
  Very simply, we are saying to the country, to the refiners, to 
petroleum marketers in particular: We are going to give you as much 
flexibility as you could possibly hope to have. And that is exactly 
what this legislation does.
  Having said that, I yield the floor and suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mrs. FEINSTEIN. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. FEINSTEIN. Mr. President, I ask my colleagues to support the 
second-degree amendment I offered this morning to the pending first-
degree ethanol mandate that would provide authority to the 
Administrator of the EPA to waive the ethanol mandate if a State or a 
region does not need it to meet the requirements of the Clean Air Act.
  In the pending first-degree ethanol mandate, there is waiver 
language, and that waiver language allows the Administrator of the EPA 
to waive the ethanol mandate if it would severely harm the economy or 
environment of a State, a region, or the United States.
  I believe the EPA Administrator should also have the ability to waive 
the mandate if a State can show that it can meet the Clean Air Act 
standards without having to use ethanol. I think that is very important 
because all the refiners in my State tell me that if we allow them 
flexibility, they can, through the reformulated model of our gasoline, 
for the most part, meet Clean Air Act standards without this mandate. 
They may have to use some ethanol--and they are using ethanol now 
because there is a 2-percent oxygenate requirement--they may have to 
use some ethanol at certain times of the year in certain areas of the 
State, but they do not need to use the amount of ethanol that this 
legislation forces them--forces them, Mr. President--to use to meet the 
Clean Air Act standards.
  This mandate forces California to use over 2.5 billion gallons of 
ethanol over 8 years that the State does not need.
  On this chart, the red shows the forced use of ethanol. The blue 
shows the ethanol we would use in certain markets during certain 
seasons to meet Clean Air Act standards. As one can see, there is a 
huge differential between the red and the blue areas.
  We use this amount shown in blue and do not use the rest of the 
ethanol which is shown in red which we have to pay for anyway. That is 
a wealth transfer, if you will. In the outer years, it most certainly 
is going to mean an increased price of gasoline at the pump for 
consumers.
  All this amendment does is add to the waiver provision one other 
possibility for waiver, and that is, if a State

[[Page 13417]]

can show that it does not need to use all of this extra ethanol to the 
EPA, the EPA can then waive the mandate. What could make better sense? 
Why would anyone oppose this as a matter of public policy? Why would 
any public policy force use and force costs on a consumer and transfer 
wealth to another area of the country when it is not necessary to do 
so? That is the crux of my argument. We do not need to use it. This 
chart clearly shows it.
  If we look at another chart, we will see that we are forced to 
transport a lot of ethanol to get it out to California; that the big 
production of ethanol is in the Midwest in what is called PADD II. Mr. 
President, 2.27 billion gallons of ethanol are made in this area. The 
entire West makes maybe 10 million gallons of ethanol. Therefore, all 
of this has to be moved not by fuel line but by barge, by truck, by 
boat, by some other way, and increases costs. That is the reason for 
the waiver. If we can show that we can meet Clean Air Act standards, 
EPA can give those States a waiver.
  I thank the Chair. I gather my time is up. I yield the floor.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I am prepared to vote. Do I have to 
yield back time?
  Mrs. FEINSTEIN. I ask for the yeas and nays, Mr. President.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  Time is yielded back.
  Mr. DOMENICI. I yield back any time I have in opposition.
  The PRESIDING OFFICER. Without objection, the vote may occur at this 
time. The question is on agreeing to amendment No. 843. The clerk will 
call the roll.
  The bill clerk called the roll.
  Mr. McCONNELL. I announce that the Senator from Missouri (Mr. Bond) 
is necessarily absent.
  Mr. REID. I announce that the Senator from North Carolina (Mr. 
Edwards), the Senator Florida (Mr. Graham), the Senator from 
Massachusetts (Mr. Kerry), and the Senator from Connecticut (Mr. 
Lieberman) are necessarily absent.
  I further announce that if present and voting, the Senator from 
Florida (Mr. Graham) and the Senator from Massachusetts (Mr. Kerry) 
would each vote ``nay''.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 35, nays 60, as follows:

                      [Rollcall Vote No. 203 Leg.]

                                YEAS--35

     Akaka
     Allard
     Allen
     Bennett
     Bingaman
     Boxer
     Cantwell
     Clinton
     Collins
     Corzine
     Ensign
     Enzi
     Feinstein
     Gregg
     Hatch
     Hollings
     Hutchison
     Inouye
     Kennedy
     Kyl
     Lautenberg
     Leahy
     McCain
     Murray
     Nickles
     Reed
     Santorum
     Schumer
     Sessions
     Shelby
     Specter
     Sununu
     Thomas
     Warner
     Wyden

                                NAYS--60

     Alexander
     Baucus
     Bayh
     Biden
     Breaux
     Brownback
     Bunning
     Burns
     Byrd
     Campbell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Conrad
     Cornyn
     Craig
     Crapo
     Daschle
     Dayton
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Durbin
     Feingold
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Hagel
     Harkin
     Inhofe
     Jeffords
     Johnson
     Kohl
     Landrieu
     Levin
     Lincoln
     Lott
     Lugar
     McConnell
     Mikulski
     Miller
     Murkowski
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reid
     Roberts
     Rockefeller
     Sarbanes
     Smith
     Snowe
     Stabenow
     Stevens
     Talent
     Voinovich

                             NOT VOTING--5

     Bond
     Edwards
     Graham (FL)
     Kerry
     Lieberman
  The amendment (No. 843) was rejected.
  The PRESIDING OFFICER. The Senator from Virginia.


                             Change of Vote

  Mr. WARNER. I ask unanimous consent that on vote No. 203 my vote be 
changed from nay to aye. There is no consequence.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  (The foregoing tally has been changed to reflect the above order.)
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. DOMENICI. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 844

  The PRESIDING OFFICER. There are now 4 minutes evenly divided. Who 
yields time?
  Mr. DOMENICI. Can we have order, Mr. President? I understand the 
Senator from California has 2 minutes. Is that correct?
  The PRESIDING OFFICER. The Senator is correct.
  Mrs. FEINSTEIN. Mr. President, I will just use a minute and then cede 
some of the remaining minute to the Senator from Arizona, if I might.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, this amendment would allow a Governor 
of a State to opt into the ethanol program. Both Alaska and Hawaii have 
been able to become exempted from the ethanol mandate. The question 
this presents for many of us is this: If a Governor of a State believes 
the program is cost effective, believes it is going to clean up their 
environment, believes it is all of the things the ethanol proponents 
say it is, then surely that Governor will opt in.
  But if a Governor of a State, depending upon geographical location, 
infrastructure for delivery, or science about the product, might decide 
not to opt into the program, that Governor would have that opportunity. 
This amendment is cosponsored by Senators Nickles, McCain, Kyl, Gregg, 
Wyden, Leahy, Schumer, Reed, Sununu, Kennedy, and Clinton.
  I thank them for their support and yield the remainder of my time to 
the Senator from Arizona.
  Mr. KYL. Mr. President, can we have order?
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. KYL. Mr. President, let's make it clear that every State still 
has to comply with the Clean Air Act. The question is how they each 
choose to do so. In Arizona, the Department of Environmental Quality, 
the department of the State that is required to cause the State to be 
in compliance, says this mandate will actually cause two of our larger 
communities, Yuma and Tucson, to be in noncompliance with the ozone 
standard during the summer months. Each State can meet the requirements 
in the ways they deem best under the amendment of the Senator from 
California. Let's not mandate a one-size-fits-all--oh, excuse me, 
except for Alaska and Hawaii--for every State. Give the Governors who 
are responsible people the ability to decide whether this is the best 
way for their State to meet the Clean Air Act standards.
  The PRESIDING OFFICER. Who yields time? The Democratic leader.
  Mr. DOMENICI. Mr. President, can we have order?
  The PRESIDING OFFICER. The Senate will be in order.
  Mr. DASCHLE. Mr. President, this amendment is based on a 
misconception. The misconception is that somehow there is a mandate to 
begin with. There is no mandate for the States under this bill.
  There is a requirement that refiners find a way to reach the goals 
that we set out in the legislation overall, both in energy as well as 
the ethanol itself, but there is no requirement that States meet some 
standard with regard to utilization of ethanol. And there is also an 
option for the States to opt out if they find the circumstances 
described by the distinguished Senator from Arizona would ever come 
about. States have the right to opt out, even though there is no 
particular mandate to opt into the program to begin with. This is a 
refiners obligation, not a State obligation.
  Mr. DOMENICI. Mr. President, might I say, if you are for an ethanol 
program for the Nation, then you can't vote for this amendment.
  If this amendment passes, there is no American ethanol program as we 
have

[[Page 13418]]

been speaking of it in terms of reducing the American dependence on 
foreign oil. It becomes something different and not an American program 
to accomplish that purpose.
  I yield the remainder of my time.
  Mrs. FEINSTEIN. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficent second.
  The question is on agreeing to the amendment, and the clerk will call 
the roll.
  The legislative clerk called the roll.
  Mr. REID. I announce that the Senator from North Carolina (Mr. 
Edwards), the Senator from Florida (Mr. Graham), the Senator from 
Massachusetts (Mr. Kerry), and the Senator from Connecticut (Mr. 
Lieberman) are necessarily absent.
  I further announce that, if present and voting, the Senator from 
Florida (Mr. Graham) and the Senator from Massachusetts (Mr. Kerry) 
would each vote ``nay.''
  The PRESIDING OFFICER (Mrs. Dole). Are there any other Senators in 
the Chamber desiring to vote?
  The result was announced--yeas 34, nays 62, as follows:

                      [Rollcall Vote No. 204 Leg.]

                                YEAS--34

     Akaka
     Allard
     Allen
     Boxer
     Campbell
     Chambliss
     Clinton
     Collins
     Corzine
     Ensign
     Enzi
     Feinstein
     Graham (SC)
     Gregg
     Hollings
     Hutchison
     Inouye
     Kennedy
     Kyl
     Lautenberg
     Leahy
     Lott
     McCain
     Nickles
     Reed
     Santorum
     Schumer
     Sessions
     Shelby
     Specter
     Sununu
     Thomas
     Warner
     Wyden

                                NAYS--62

     Alexander
     Baucus
     Bayh
     Bennett
     Biden
     Bingaman
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Byrd
     Cantwell
     Carper
     Chafee
     Cochran
     Coleman
     Conrad
     Cornyn
     Craig
     Crapo
     Daschle
     Dayton
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Durbin
     Feingold
     Fitzgerald
     Frist
     Grassley
     Hagel
     Harkin
     Hatch
     Inhofe
     Jeffords
     Johnson
     Kohl
     Landrieu
     Levin
     Lincoln
     Lugar
     McConnell
     Mikulski
     Miller
     Murkowski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reid
     Roberts
     Rockefeller
     Sarbanes
     Smith
     Snowe
     Stabenow
     Stevens
     Talent
     Voinovich

                             NOT VOTING--4

     Edwards
     Graham (FL)
     Kerry
     Lieberman
  The amendment (No. 844) was rejected.
  Mr. REID. I move to reconsider the vote.
  Mr. McCONNELL. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from New Mexico.


                  Next Generation Lighting Initiative

  Mr. BINGAMAN. Mr. President, will the manager of the legislation 
yield for a question?
  Mr. DOMENICI. I am happy to yield.
  Mr. BINGAMAN. Section 914 of this legislation directs the Secretary 
of Energy to establish a research and development program on solid-
state lighting. I worked on this provision with the Senator from New 
Mexico, the chairman of the Energy and Natural Resources Committee, and 
I thought it would be useful to have his agreement that this program 
should not be a traditional grant, contract or cooperative agreement 
effort. The Department of Energy, DOE, should administer this program 
in partnership with an alliance of solid-state lighting industry 
partners who will act to guide and evaluate the research.
  Mr. DOMENICI. I certainly concur. The alliance should be an inclusive 
but well-defined group of companies active in the research, development 
and implementation of solid-state lighting technologies in the United 
States. The DOE should select the alliance as quickly as possible, so 
as not to delay the program's implementation.
  Mr. BINGAMAN. If the Senator would yield for a further question, I 
would like to know whether he also agrees that our intention is that 
academia, national laboratories and other research organizations should 
perform most of the fundamental research, while commercial entities, 
especially alliance companies, should perform most of the development 
and demonstration work. The selection of DOE laboratories should be 
based on demonstrated technical accomplishments in the field of solid-
state lighting, particularly inorganic and organic light-emitting 
diodes.
  Mr. DOMENICI. Mr. President, again I completely agree with the 
Senator. I would also add that the intellectual property in section 914 
is patterned after the Department of Energy's Solid State Energy 
Conversion Alliance, or SECA. Under the SECA model, research and 
development qualifies for the ``exceptional circumstances'' provision 
of the Bayh-Dole Act. Inventors still retain rights to their 
intellectual property. Those alliance participants who are active in 
solid-state lighting research and development will receive the first 
option to negotiate non-exclusive licenses and royalty payments to use 
the invention.
  Mr. BINGAMAN. I thank the Senator and would ask one final question. I 
think he would agree that solid-state lighting is in its research 
infancy. While it holds a promise to make white light illumination 10 
times more efficient than today's light bulb, it is imperative that the 
DOE implement this program quickly, and transfer the pre-competitive 
research to industry, so that our country can retain its leadership 
position in lighting--a field that Thomas Edison started.
  Mr. DOMENICI. I fully agree. The Senator serves as our ranking member 
and was instrumental in the adoption of this provision by our 
committee. I think we both expect that quick action by the Department 
of Energy will stimulate the private sector.
  Mr. BINGAMAN. I thank the Senator for yielding.


                 Amendment No. 845 to Amendment No. 539

(Purpose: To amend the Internal Revenue Code of 1986 to accelerate the 
 increase in the refundability of the child tax credit, and for other 
                               purposes)

  Mr. BINGAMAN. Madam President, on behalf of Senator Schumer and 
Senator Lincoln, I send an amendment to the desk and ask for its 
immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from New Mexico [Mr. Bingaman], for Mrs. 
     Lincoln, proposes an amendment numbered 845 to amendment No. 
     539.

  Mr. BINGAMAN. Madam President, I ask unanimous consent that the 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. REID. I ask unanimous consent that the majority whip be 
recognized to speak for up to 5 minutes.
  Mr. McCONNELL. As in morning business.
  The PRESIDING OFFICER. Is there objection to the request of the 
Senator from Virginia? Without objection, it is so ordered.
  Mr. McCONNELL. I thank the distinguished assistant Democratic leader.
  (The remarks of Mr. McCONNELL are printed in today's Record under 
``Morning Business.'')
  Mr. McCONNELL. Madam President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. FRIST. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Amendment No. 539 Withdrawn

  Mr. FRIST. I now withdraw amendment No. 539.

                          ____________________