President Reagan and Republican congressional leaders reached an understanding yesterday that he will not ask Congress this year for faster decontrol of natural gas prices.
At a White House meeting, Senate Majority Leader Howard H. Baker Jr. (R-Tenn.) told Reagan that Congress would not agree to speed up the decontrol timetable without also imposing a windfall profits tax on natural gas, as it did with oil.
Reagan is opposed to such a tax, which would come on top of regular income taxes and capture for the treasury more of the proceeds from the price increases the government would be allowing.
In July, Reagan's Cabinet Council on Energy and Natural Resources recommended speeding up decontrol of wellhead prices of newly discovered gas, which are now supposed to end in 1985 under terms of the Natural Gas Policy Act. In addition, the Cabinet group urged that prices of presently flowing gas also be decontrolled over a three-year period, something that would not occur under present law.
House Minority Leader Robert H. Michel (R-Ill.) told reporters, "There was a consensus in the meeting that it is impossible to get it faster decontrol done before adjournment this session." If that is the case, the discussion ran, then why bother to introduce the administration proposal this year, Michel said.
To get House approval for faster and more sweeping decontrol of natural gas prices, "an educational program will be needed," Michel said. He also said he agreed with Baker that such a proposal would not pass unless a windfall profits tax is attached.
Sen. James A. McClure (R-Idaho), chairman of the Senate Energy Committee, said he thought the Senate also would approve what the administration has in mind, but only with a tax as part of the package. "If there is decontrol of old gas, there would have to be a tax," he declared.
Natural gas producers generally have begun to concede that they may have to go along with such a tax in order to get decontrol. They may have to make such a concession publicly before any decontrol proposal gets very far.
The problem is that last July, the president sent a handwritten letter to Rep. Glenn English (D-Okla.), after he had been Reagan's guest at Camp David, in which Reagan said, " . . . I'm opposed to that type of tax and believe it is counterproductive. If legislation should ever be passed calling for such a tax I would -- with pleasure -- veto such a bill."
With so firm and so public a commitment, administration officials and representatives of natural gas producers believe the only way Reagan could recant would be if English publicly asked him to do so.
Estimates of how much revenue such a tax might bring in vary widely, partly because no one can predict with any certainty just how far the average price of natural gas at the wellhead would rise during and after a phased decontrol plan.
With the administration searching for new revenue sources to help hold down the federal budget deficit and ease pressures in financial markets, David A. Stockman, director of the Office of Management and Budget, supposedly had been looking at such a tax as a possible answer.
McClure said that the revenue implications of a windfall tax were discussed at yesterday's meeting. But rather than pressing for such a tax, McClure said Stockman reminded everyone that he was one of the few congressmen who voted against a windfall profits tax on oil.
Meanwhile, consumer groups are strongly opposed to any acceleration in the decontrol timetable. One group, the Citizen-Labor Energy Coalition, has predicted that decontrol would double homeowners' gas bills and increase inflation by 2 to 3 percentage points a year between 1982 and 1985. Other estimates put the impact at considerably less than that, however.
The Northeast Coalition for Energy Equity, which represents heating oil dealers who compete with natural gas supply companies in nine northeastern states and therefore favor higher gas prices, released a study Sunday indicating the federal government could increased its revenues by nearly $50 billion over the next four years by completely decontrolling prices next year.
McClure's committee will hold a hearing beginning Thursday on the way in which the Natural Gas Policy Act is being administered. But McClure, who has repeatedly opposed taking up the decontrol issue this year, hopes to avoid consideration of whether the decontrol process should be speeded up, committee sources said.