By Jeffrey H. Birnbaum
Washington Post Staff Writer
Wednesday, September 28, 2005
With Congress dangling as much as $200 billion in hurricane-related aid, lobbyists for oil companies, airlines, manufacturers and others are clamoring to get their share.
"It's been all Katrina all the time, and now it's Rita, too," said J. Steven Hart, chairman of Williams & Jensen PLLC, a top lobbying firm in the capital. "Except for the Supreme Court, hurricane recovery is what Congress will be up to so we have no choice but to adapt."
Lawmakers are receptive to many of these requests, congressional aides said. For example, House Energy and Commerce Committee Chairman Joe Barton (R-Tex.) is moving legislation this week, much of it recommended by lobbyists, that would waive regulations to help oil companies build new refineries. The reason: the hurricanes drew attention to the nation's dependence on a small row of Gulf coast refineries.
The oil lobbyists, like so many others, are using the storms as an excuse to win long-sought legislation, even when their plans relate only tangentially to the hurricanes.
Earlier this week groups as diverse as the American Institute of Architects and the American Petroleum Institute were freshening their requests for tax breaks and other favors. The architects changed "Katrina" to "hurricane disaster" in their pitch.
The troubled airline industry has been particularly active on the hurricane front. Delta Air Lines Inc. and Northwest Airlines Corp. are trying to include relief from their pension obligations in hurricane legislation this year. The firms have been pressing for the change since the spring, before the hurricane season, but are telling lawmakers that the fuel price hikes in the wake of Katrina have made the aid more necessary.
"Katrina adds an urgency," said Benet J. Wilson, a Delta spokeswoman said. But so far the proposal remains stalled.
The Air Transport Association, the airlines' trade group, is seeking a national change in response to the regional devastation. It wants Congress to waive for a year the 4.3 cent-per-gallon tax on jet fuel, a plan that would cost $600 million. "Katrina exacerbated an already untenable situation with respect to the price of oil on our industry," said James C. May, president of the association.
"I am quite confident there will be many who make that charge -- that we are self serving," May said. "But I am equally confident that the impact that Katrina had on this industry is real."
Insurers have been using Katrina as an argument for approving their long-held top priority, an extension of the Terrorism Reinsurance Act (TRIA), which provides for the government to pay a portion of the damage caused by a foreign terrorist attack over certain thresholds. To illustrate the tie between the hurricane and the legislative effort, Carl M. Parks, senior vice president of the Property Casualty Insurers Association of America, has coined the term "KA-TRIA."
Farmers, even those outside the disaster zone, are begging for hurricane cash. "It is important to remember that the economic impact of Hurricane Katrina is harming much more of U.S. agriculture than producers in those three states," Bob Stallman, president of the American Farm Bureau, wrote to legislators. "As the Senate and House Appropriations Committees prepare to address this natural disaster, we urge you to include emergency disaster assistance for farmers and ranchers."
The nation's for-profit hospitals are trying to persuade Congress to carve an exception into a decades-old law specifying that only nonprofit institutions qualify for grants from the Federal Emergency Management Agency to rebuild critical facilities after a natural calamity. "Storms do not damage hospitals based on their ownership status," said Richard Coorsh, spokesman for the Federation of American Hospitals, which represents investor-owned hospitals.
The change for hospitals would not apply only to those damaged by Katrina. Coorsh said the group would like Congress to grant for-profit hospitals permanent access to FEMA funds wherever a natural disaster occurs. The federation sought the same change, unsuccessfully, following the Sept. 11, 2001 terrorist attacks.
Other industries have been careful to focus their proposals on the people and businesses of the Gulf Coast. The Travel Business Roundtable, a coalition of chief executives of hotel, restaurant and other travel-related companies, is campaigning for a host of grant, tax-cut and loan relief proposals, all specific to the storm-affected region and time limited. "We're not going to be irresponsible," said Charles L. Merin, the roundtable's chief Washington representative.
Nonetheless, the list, if fully enacted, would be very expensive -- several billion dollars.
Lobbyist Anne C. Canfield, like almost everyone else on K Street, is also angling for hurricane assistance. In an e-mail to her clients in the mortgage business two weeks ago, Canfield noted that with so much money flowing, "Why not have some of those funds be used to actually help the mortgage industry and its consumers?" Her suggestion: Make every waterlogged homeowner in the Gulf Coast region eligible to receive federal flood insurance payments of up to $250,000, even if they had never bothered to buy the coverage. Bush officials aren't happy with the plan.
Not all of the lobbying is in search of benefits. Some of it is defensive, trying to fend off changes that are also related to the hurricanes such as potential tax increases. The oil industry is reminding lawmakers that price controls aren't a good idea. A highway-building trade association is asking lawmakers not to reduce gasoline taxes as a way to help consumers. The reason: Lower gas tax revenues might squeeze the federal trust funds that are used to build roads and bridges.
Lobbyists have submitted so many suggestions that lawmakers "will have to be more vigilant and take a hard line," said John Scofield, spokesman for the House Appropriations Committee.
Nonetheless, they likely will get much of what they want. "The climate is very favorable to further spending and further tax cuts, especially for Katrina, and Hurricane Rita will only increase that tendency," said Gregory R. Valliere, chief strategist of Stanford Washington Research Group. "Neither party wants to be seen as uncaring."
A lot of lobbyists' pleas dressed in hurricane clothing are for things that Congress has rejected for years. John M. Engler, president of the National Association of Manufacturers, has called for the opening of oil and gas drilling on the ocean's Outer Continental Shelf as a way to increase the availability of energy. Why now? Because Katrina is a reminder of how fragile the country's energy infrastructure is, he said.
The proposal in the past was dismissed as environmentally risky, and it still faces an uphill climb. But now Jack N. Gerard, president of the American Chemistry Council, sees hope for it. "The unfortunate tragedy in New Orleans," he said, "has sharpened the focus on our unfinished business."
Staff writer Amy Goldstein contributed to this report.