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House Interior Appropriations Budget Carries Ill Winds for National Park System

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With all the drama surrounding the White House negotiations to raise the nation's debt limit without doing further damage to the country's fiscal profile, legislation still working its way through the House of Representatives understandably takes a backseat.

But as crafted, the proposal concerning Fiscal Year 2012 funding for the Interior Department stands to do more than a little harm to the National Park Service's fiscal fitness, and also threatens to degrade the watersheds that drain into the Colorado River as it runs through Grand Canyon National Park.

"In its current form, it's deeply damaging to our national parks, Grand Canyon in particular," John Garder, the National Parks Conservation Association's budget and appropriations legislative representative, said Monday.

As it stands, the bill would, if enacted, reduce overall funding for the Park Service, weaken air and water regulations that are needed to protect park resources, and stall efforts to let the agency acquire a private 1,400-acre inholding in Grand Teton National Park.

The legislation, which was scheduled to be considered by the full House Appropriations Committee on Tuesday, has drawn criticism from a number of groups concerned about its environmental impact.

Trout Unlimited issued a release last week that condemned the bill, saying it "cuts funding for essential conservation programs like the Land and Water Conservation Fund and North American Wetlands Conservation Act, and contains harmful riders that undermine the Clean Water Act and other protective rules for rivers and streams."

“Fishing and hunting generate $76.7 billion annually in economic activity in the U.S.,” said Steve Moyer, vice president for government affairs at Trout Unlimited.  “We can’t expect to sustain this powerful economic engine if we’re removing the very conservation programs that make it run.”

At the Natural Resources Defense Fund, Scott Slesinger, the group's legislative director, said the legislation "is a contract on America masquerading as a spending bill. It’s nothing short of a declaration of war on our most basic health protections."

"It would do away with fundamental safeguards that keep our air, water and lands clean. Worse than making deep budget cuts, the bill is chock full of gratuitous policy riders that are unprecedented in number and scope. They have no place in a budget -- or anywhere else.”

Back at NPCA, Mr. Garder said one of the most egregious riders, or amendments, to the bill would block efforts to continue a moratorium on new mining claims on 1 million acres surrounding Grand Canyon National Park for 20 years.

“What really put us over in the edge in opposing this bill were the policy riders, in particular one that would undermine protections for the Grand Canyon," he said during a phone call from his Washington, D.C., office.

The proposed 1 million-acre buffer was identified "through a public process that allowed for public comment, and 300,000 people commented and the determination was that it is appropriate for the protection of Grand Canyon and for the 25 or so million people who rely on the Colordao River for drinking water and their uses," said Mr. Garder.

If the moratorium is not put in place and uranium mining claims are allowed, “It is not unfathomable to imagine that those who are hiking around the Grand Canyon would have to note in which streams there is uranium contamination and carry their own water," he added.

Conservation groups are not the only organizations that support the 20-year moratorium, said Mr. Garder, noting support for it from the Metropolitan Water District of Los Angeles, the Southern Nevada Water Authority, the Central Arizona Project, and Native American tribes in the Southwest.

Other sections of the proposed legislation the NPCA takes issue with include:

* Efforts to weaken or remove Environmental Protection Agency regulation of greenhouse gases;

* Efforts to weaken EPA regulation of coal ash;

* Efforts to weaken oversight of stormwater discharges, something that can lead to degredation of waters such as the Chesapeake Bay;

* Cuts to the Land and Water Conservation Fund that would zero out funding for Park Service lands acquisition;

* A $7 million cut in National Park Service funding.

“That is less than 1 percent," Mr. Garder said of the $7 million, "but it is on top of the cuts that park operations received last year. Something that concerns us is backtracking on funding for an account that is essential to ensuring our parks operate essentially.”

The Park Service already is underfunded by roughly $600 million a year, according to the NPCA, and this proposed cut, while small, would nevertheless have to be absorbed by the parks, he said.

Without the LCWF land acquisition funding, the Park Service also might not be able to move forward with the $107 million purchase from the state of Wyoming of 1,400 acres inside Grand Teton. The administration had been counting on the LCWF funds to start the purchase with a $10 million downpayment in the coming fiscal year, according to Mr. Garder.

“But when there is an effort to prevent any new land acquisition projects in FY12, that’s going to seriously undermine that multi-year effort, and the threat of development there should not be underestimated," said Mr. Garder. "It’s critical that this bill go through if we’re going to prevent the building of trophy mansions or subdivisions in the middle of Grand Teton National Park.”

The House measure also carries an 18 percent cut to the Park Service's construction budget, which the president had already reduced by $50 million in his budget proposal, said the NPCA budget analyst.

“If you look at the suite of those (construction) needs, there are some projects in there that are clearly very important for the protection of visitor safety and the protection of the historic and natural resources,” Mr. Garder said.

For instance, at Grand Canyon National Park there's a $16 million need for a storage system for potable water for park visitors, and at the Statue of Liberty National Monument there's a need for asbestos abatement work, roofing, sidewalk repairs, and seawall repairs that alone are estimated to cost nearly $11 million, he said.

“Many of those jobs are contracted to businesses, and so there is a direct jobs loss component when you are reducing the ability for the Park Serivce to engage in some of those contracts to do some of those basic repairs,” said Mr. Garder.

How the legislation will fare after the House Appropriations Committee deals with it remains to be seen, he said. The full House might take it up next week, or possibly not until September. And the Senate has not even started its work on the Interior Appropriations measure, he said.

Of course, the lawmakers could find themselves having to go back to square one, depending on how negotiations over the nation's debt limit go with the White House.

Comments

EC, I think your Exxon figures are off. Here's what the company's chairman, Rex Tillerson, had to say in discussing year-end 2010 revenue figures:

The full year 2010 earnings, excluding special items, were $30.5 billion, up 57% from 2009, driven by higher crude oil and natural gas realizations, stronger refining margins and record Chemical performance. Fourth quarter earnings were $9.3 billion, an increase of 53%.

Oil-equivalent production was 19% higher than the fourth quarter of 2009, driven by our
world-class assets in Qatar and our growing unconventional gas production. Capital and exploration expenditures were $32.2 billion in 2010, reflecting a record level
of investment.

The Corporation returned over $19 billion to shareholders in 2010 through dividends and
share purchases to reduce shares outstanding.”

By the way, that $30.5 billion in earnings was net, after taxes, according to the company's press release.

Doesn't sound too shabby to me.


"In a review of the five specific tax changes being advocated by Democrats, the research service also said that tightening the tax code would make A VERY SMALL DENT IN THE HUGE REVENUES of the industry and that THE PRICE OF OIL HINGED ON MANY OTHER, LARGER CONSIDERATIONS. Political unrest, market gyrations, 'macroeconomic growth trends, the value of the dollar and a host of other factors have contributed to fluctuations in the price of oil and gasoline,' the report said. 'Any effect due to changes in the tax treatment of the oil industry would be hard to separate from the changes due to other factors.'" (emphasis mine)

Seems pretty clear to me, ecbuck.  This is from the Times article, but you might take a second look at both of them--or the CRS report itself (if you want to check their documentation).


Once again Kurt, nothing in those statements are contrary to what I said.  Exxon earned $30.5 billion up 57% from 2009.  But 2009 was down 58% from 2008.  And if you do the math you will realise that 57% up doesn't recover from 58% down - not even close.

Profit
2010 30.5 billon
2009 19.3
2008 45.2
2007 40.6
2006 39.5
2005 36.1
2004 25.3

2010 wasn't a record year.  In fact, you have to go back to 2004 to find a year that profits were lower.

"Doesn't sound too shabby to me."

But then, you didn't invest $300 billion in assets.  That $30 billion is a 10% return on assets.  Hardly a windfall.


'Any effect due to changes in the tax treatment of the oil industry
would be hard to separate from the changes due to other factors.'"
(emphasis mine)"

Hard to seperate and non-existent are two very different things.  By your logic, political unrest, market gyrations, marcroenconomic trends the value of the dollar and a host of other factors wouldn't matter because they would be "hard to seperate".

Anyone that believes that tax rates don't effect pricing, employment, plant locations et al is totally naive.


Fine Ec, you win.

But let's recap: First you said Exxon made $30 million in '10, when in fact they made $30 BILLION. When that was pointed out you moved the yardsticks and said "$30 billion .... is hardly a windfall."

I bet the stockholders were pleased.

And let's not overlook that none of those years you cite showed a loss for the company. So whether it's up 57 percent one year or down 58 percent from the previous year, it's not like Exxon lost money in any of those years. Was 2009 an off year when compared to 2008? Absolutely. But what company wouldn't love to be able to report a $19.3 billion profit (which, by the way, was lower than 2010's profit, so you don't have to go all the way back to 2004 to "find a year that profits were lower.")

But that's beside the point. No one's talking about record profits or windfalls. The point you brought to this discussion much higher up is profitability. And the oil companies have demonstrated a nice track record of returning profits. If they couldn't, they wouldn't be in business.

Frankly, a 10 percent return sounds pretty darn good to me; I wish my portfolio returned that. And I'm guessing that $300 billion in assets wasn't purchased in 2010, but over the long run.


"First you said Exxon made $30 million in '10, when in fact they made $30 BILLION."

If I said "million" it was obviously a misstatement.  It has always been "Billion" and I always meant "billion".

"I bet the stockholders were pleased."

And that is bad?

"And let's not overlook that none of those years you cite showed a loss for the company."

So the company should operate to generate a loss?

" But what company wouldn't love to be able to report a $19.3 billion profit"

A company that invested $300 billion.  You seem so fixated on the absolute number.  $19.3 billion (or $30 billion) means nothing without the context of the investment made.

"And the oil companies have demonstrated a nice track record of returning
profits. If they couldn't, they wouldn't be in business."

Welcome to America.  That is the purpose of a corporation - to return a profit.  If they couldn't, they wouldn't be in business and your life would be materially different - for the worse.

"I wish my portfolio returned that."

Maybe you should invest in ExxonMoble


" And I'm guessing that $300 billion in assets wasn't purchased in 2010, but over the long run."

Of course - who whould invest $300 billion annually for a $30 billion annual return?  I'm sure you don't put the full value of your portfolio in anew every year but rather earn on the cummulative account.

BTW   Apple has a 25.7% ROA, Texas Instruments 25%, Mastercard 24.2%, Microsoft 23.6%.  Should we jump up their tax rates because they are profitable?

Fact is the average for the S&P 500 is just short of 9%.  Not substantially different from the 10% ExxonMobil earned in 2010.


ecbuck,

You'd have a point if the previous sentence did not exist: ".... THAT THE PRICE OF OIL HINGED ON MANY OTHER, LARGER CONSIDERATIONS."  The other, larger considerations are what the price of oil hinges on.


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