The Senate yesterday overwhelmingly defeated a proposal to add $1.5 billion to fiscal 1982 budget funds for the Strategic Petroleum Reserve (SPR), but adjourned before other pending amendments could be considered after news of the attempted assassination of President Reagan reached the floor.
Sen. Bill Bradely (D.-N.J.) had planned to propose an amendment restoring the full $3 billion deleted last week by the Senate Budget Committee's reconciliation resolution, to a total of $3.8 billion. In view of the decisive vote against adding $1.5 billion to the $800 million presently recommended by the Budget Committee, sources said that it "looked bad" for the Bradley amendment if it is introduced today.
Earlier, Congressional Budget Office Director Alice Rivlin had told a Senate Energy subcommittee that filling the nation's Strategic Petroleum Reserve is so important that the procedure shouldn't be delayed in an effort to seek financing outside of the federal budget.
Paying for the SPR out of federal budget funds appears to provides the "lowest expected cost," Rivlin said, while moving to some sort of alternate financing not only creates "uncertainty" but the possibility of being even more costly in the end.
Originally, after examining alternate financing possibilities, the Reagan administration proposed a budget expenditure totaling $3.8 billion for the SPR in fiscal 1982. This carried through a Reagan campaign commitment, repeatedly endorsed by budget director David Stockman, to fill the SPR. The Reagan team had been highly critical of the Carter administration for failing to provide such an emergency stockpile of oil against the possibility of an interruption of imports.
But when the Senate Budget Committee dropped the $3.8 billion spending figure down to $800 million, on the assuption that private financing of the SPR through the sale of bonds could pay most of the costs, the Reagan administration sent confused signals to Capitol Hill.
After telling Bradley that his planned move to restore the full $3.8 billion had White House backing, the administration, through a spokesman for the Office for Management and Budget said last Thursday that the administration was "neutral" on the subject -- in effort leaving it to Congress to decide on the financing.
A State Department official yesterday told The Washington Post that although he had thought the issue had been settled in favor of government financing of SPR through the budget, "neutral" still expressed the White House attitude at the moment, and a compromise might yet be struck.
Yesterday, Rivlin, while acknowledging that private financing in feasible, said the likelihood that oil prices will increase creates the "uncertainty" that it can be accomplished efficiently. A number of proposals for private financing has been introduced, including one by Sen. Nancy Landon Kassebaum (R.-Kan.), which would require major oil importers to contribute to the SPR.
The thrust of Rivlin's testimony yesterday was that the present system of paying for the SPR is in place and demonstrably workable and that a shift to some another method of financing could jeopardize the filling of the oil stockpile.
She said that some other method of financing might also work, but that "we should not lose sight of the importance of filling the strategic petroleum reserve rapidly." Rivlin noted that renewed supplies from Iraq and Iran this year presents an opportunity to move promptly to add to the SPR, if funds are available at once.