Dianne Feinstein

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Madam President, once again, this is just a very modest amendment. It delays the implementation of this mandate by 1 year, until 2005. It gives both coasts of the United States the opportunity to do what they need to do to increase refining capacity, to develop the terminals, to develop the truck fleet, and to get ready for what is going to be a massive infusion of a product that can't be shipped by pipe. It has to be shipped by truck or by rail or by barge. I hope the Senate will allow us this additional year to get ready for this unfortunate mandate. Amendments Nos. 3332, 3333, 3370, 3372, 3239, As Modified, 3146, As Modified and Further Modified, 3082, 3355, and 3335

Mrs. FEINSTEIN. Mr. President, I call up amendment No. 3225, and I ask for the yeas and nays.

Mrs. FEINSTEIN. Mr. President, the amendment I call up is a very modest amendment to the renewable fuels provision in the Senate energy bill. It will simply delay the implementation of the ethanol mandate for 1 year. That would move it from 2004 to 2005. The purpose of the amendment is to give States more time to make essential infrastructure refinery and storage improvements. This amendment will provide the Senate with the opportunity to make an essential modification to the current bill since virtually every State outside of the Midwest will have to grapple with how to bring in more ethanol over the next several years. Although the ethanol industry says they can meet future demand, virtually every expert has told me that delivery interruptions and shortfalls are likely, if not inevitable, and yet we are tied to bring in a specific amount. In 2004, the Nation will be forced to use 2.3 billion gallons of ethanol. There is insufficient transportation infrastructure to ship large amounts of ethanol to the east and west coasts, and a temporary reprieve is essential to develop the infrastructure, especially when the infrastructure demands for ethanol are far more complex for ethanol than for MTBE. Here is why infrastructure is so important. Moisture causes ethanol to separate from gasoline. So the fuel additive cannot be shipped through traditional gasoline pipelines. Ethanol needs to be transported separately by truck, boat, barge, rail, and then blended into the gasoline at the refinery site after it has arrived. Yet it will not be so easy to transport ethanol by truck, boat, or rail from the Midwest and blend it once it is transported, unless adequate facilities can be built. According to the California Energy Commission, the adequacy of logistics to deliver large volumes of ethanol is not consistent. A recent report sponsored by the California Energy Commission predicts there will be future logistical problems since the gasoline supply system is currently constrained with demand exceeding the existing infrastructure capacity. In fact, inadequate infrastructure recently led the Governor of California to push back the start date of the State's ban on MTBE to 2004 from 2003. California does not have the ethanol infrastructure in place to meet the oxygenate requirement under current law once MTBE is banned. The Governor had little choice because California's predicted gas prices at the pump would double if the MTBE ban went into effect as planned in 2003. This is due in part to the lack of infrastructure. It is also because once MTBE is removed, California needs 5 to 10 percent more gasoline with ethanol. Here is why. MTBE helps reduce the amount of gasoline needed to make a gallon. Ethanol, however, does not go as far as MTBE, so it increases the amount of gasoline needed to make a gallon. Once we have phased out MTBE, the difference is estimated by experts to require 5 to 10 percent more gasoline in every gallon of gasoline that is produced with ethanol--5 to 10 percent more. California's refining capacity is at capacity. It is 98 percent, which is capacity. Therefore, we cannot refine 5 to 10 percent more gasoline under the present refining conditions. Therefore, not only are there going to have to be massive improvements in the ability to bring ethanol into the State, but there have to be massive changes made in the refineries themselves, and this is going to take time. Somehow we are going to have to bring online additional refining capacity to handle the tripling of ethanol that is required over the next 10 years by this bill. This is one of the reasons, from a California perspective, the ethanol mandate is worse for California than for any other State, and for California it is going to spike the cost of gasoline. Let there be no doubt, we have troubles even the way things are with gasoline supply. As a matter of fact, gas in California is going up. One of the reasons is refinery outages, the shortage of gasoline. That is a very real problem. This additional year, from 2004 to 2005, will give all States, and especially the east coast and west coast States, an additional year to solve some of these problems. Before forcing three times the amount of ethanol we currently produce in our fuel supply, I sincerely urge the Senate to adopt this amendment to allow those States that have problems, of which ours is prime, to be able to develop the terminals, the trucks, and the barges to bring in ethanol and the refinery changes that are going to be necessary to produce more gasoline, as well as to absorb ethanol into the situation. Let me summarize. In the past days, we have made the following points: That the Senate bill requires 5 billion gallons of ethanol by 2012. The mandate will force California to use 2.68 billion gallons more of ethanol than we need to meet clean air standards. We have proven, I think, that this is a hidden gas tax of anywhere from 4 to 10 percent, and the infrastructure shortfalls in California will most likely put the gas tax hike above that. We have shown there are transportation and infrastructure problems. We have shown there is a dangerously high market concentration. We point out Archer Daniels Midland has a 41 percent market share. The Wall Street Journal this morning contains a very interesting article on this very subject entitled ``ADM Used European Wine For Ethanol.'' It shows how recent evidence has been uncovered to suggest that ADM engaged in bid rigging, which is a form of price fixing, with respect to European ethanol brought into the United States. So giving any company a large concentration of market share can also produce exactly what we went through with Enron. We have shown that ethanol has mixed environmental and health benefits. It does decrease carbon monoxide. However, it increases nitrogen oxide emissions, or NOx, which will increase smog in my State and in other States. We have demonstrated there will be less revenue to the highway trust fund because gasoline is taxed at 18.4 cents to provide funds for our roads and bridges, but fuel blended with ethanol is only taxed at 13.1 cents. Therefore, this mandate will create an unbelievable $7 billion shortfall in the highway trust fund, and it will provide every State in the Union less dollars to build roads, bridges, and transportation infrastructure. We have shown, and Senator Boxer did this eloquently, that the safe harbor provision of the bill prevents legal redress if ethanol and other fuel additives harm the environment, because it removes the unsafe product liability cause of action. That is the one cause of action that sustained the cases in California brought on MTBE, and this bill removes it for ethanol. Why is this in there? Because the oil companies wanted liability protection or they would not go along with the deal that was cut. So they were given liability protection and no one can bring an unsafe product cause of action against ethanol. We have shown that ethanol is not a renewable fuel because some scientists believe it takes 70 percent more energy to make ethanol than it saves using it, and we have shown that the ethanol mandate will largely benefit producers, not farmers. Producers will get 70 percent of the benefit; farmers, 30 percent according to one report. We have shown what this amounts to is a massive transfer of wealth. The bottom line is the ethanol provisions of this bill are a very bad deal and that mandating 5 billion gallons of it, a tripling of it, by 2012, which never had a hearing in the Energy Committee, never saw the light of day before the deal was put together in secret and apparently a majority of the Senate is going to support it, we ask one thing, and that is that California and other States that need it, on the east coast and on the west coast especially, be given one more year to increase the refining capacity, to improve the infrastructure, to see that the terminals are in place and that we can, in fact, triple ethanol and have enough gasoline to supply our need. It is my understanding the junior Senator from California would like to ask a question.

Mrs. FEINSTEIN. Madam President, how much time do I have?

Mrs. FEINSTEIN. Madam President, I would like to respond to the Senator. I found his comments really quite amazing. On the one hand, he was saying how generous he was being to California; on the other hand, he was saying: Tough, if it spikes your cost of gasoline; tough, if you don't have enough refinery capability, that is your fault. I am for the farmers in the Midwest, and all the rest of you be damned. I don't appreciate that very much. I will tell you something: When the price of gasoline does spike and people are calling, I will refer them to your office, Senator, and be happy to do so. We are being forced to use something we do not need. It would be one thing if we needed it to meet clean air standards. We are being forced to use 2.68 billion gallons of ethanol we do not need in California to meet clean air standards. I resent that. I resent that the policy of the United States Senate mandates that we have to use something we do not need that is going to cost us more, that is going to prevent us from getting highway money and transportation money because it is going to cut the highway trust fund by $7 billion. I resent the fact that I am on the Energy Committee and this bill was not even run by the committee; that there has been no public hearing held on any part of it. I resent that fact. I resent the fact that you don't care whether my State has the refining capacity or not to meet this in time. We have tried to be nice all during this debate, but I resent the fact that this is a deal cut in secret, when nobody who is affected adversely has a chance to weigh in. I resent the fact that we have no chance to get experts before a committee, to say what we do and do not know about ethanol. I resent the fact that everybody says it is just great, when scientists have said it may have real problems attributed to it and we cannot even have a hearing to listen to those problems. I resent that. I do not think it is good public policy. It might be good in a political campaign. I resent the fact that I had the refiners, the ethanol people and the corn farmers, in my office for 8 months trying to negotiate something that California could live with, and then both Presidential candidates announced their support of ethanol and the corn growers reversed and said: Forget you, we are not going to negotiate with you; now we can get much more. And the ``much more'' has resulted in a tripling of an additive we do not need. Senator Boxer and I are standing here like two lone sheep trying to make an argument when the deal has already been cut, when we have never been consulted. The Senator from New York, what is she going to do when her gasoline price spikes--because it is going to--because we did not have that opportunity? I resent that as public policy. I have every right to. I represent 34.5 million people, the fifth-largest economic engine on Earth, and we are being told: It is good for corn farmers, so, you guys, lay down and take it. I am being told: Oh, we have a credit trading system. But the fact of the matter is, if you really read the fine print: Use it or pay for it. I have a problem with that public policy. And I have every right to stand on this Senate floor and say I have a problem with it, and say I think this is unfair, and say I think it is done in the dark of night, and say I do not think anybody who is really affected by it has been let into that secret, dark room. Yes, you have all cut your deal, and both coasts are going to suffer because of it. I talk to Senators who I was surprised were in on the deal. What they told me was: We had to, or they would not let us stop using MTBE. We had to, or they would not let us stop using MTBE. That is the way public policy is made. It is wrong. I am sorry, it is wrong. We lose today, but guess what, we will watch this thing. We will watch this with the eyes of a hawk. You can be sure we will have more to say about it because it is bad public policy. To mandate States to use something they don't need, when they can meet clean air standards with reformulated fuel except for a small part of the year, in a certain market--it is wrong. It is bad public policy.

Mrs. FEINSTEIN. I will be happy to yield because my adrenaline will then drop and my blood pressure will as well.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, when the members of the Senate Energy Committee, including Senator Schumer, Senator Cantwell, Senator Wyden, and I, began talking about doing a comprehensive energy bill more than a year ago there were three major things all of us said that we wanted to see in the bill. First we believed that we needed to reduce our energy consumption and hence our country's dependence on foreign oil. Second we wanted to get to the bottom of what was happening with energy markets in California and the West where electricity and natural gas prices were 10-25 times higher that they should have been. And we wanted to do all we could to ensure that a crisis of this magnitude could never happen again. And third, we wanted to address global warming by quantitatively and measurably reducing our emissions of greenhouse gases. These are still the elements I support in an energy bill. But the simple fact of the matter is that these elements are not in this bill. First the Senate rejected Senator Cantwell's and my amendment to provide transparency, oversight and authority by the Commodity Futures Trading Commission (CFTC) on energy derivative trading. What we saw in energy markets was the on-line trading of energy commodities like natural gas and electricity multiple times to drive up prices and escape any federal oversight or transparency whatsoever. This is what Enron was doing through its on-line trading company, Enron On-Line before the company went bankrupt. And Dynegy and Williams, two companies operating on-line exchanges similar to Enron On-Line have taken over some of Enron's market share and are trading without oversight or transparency either. The Senate had the opportunity to address this problem which arose from the Commodity Futures Modernization Act of 2000. But instead the Senate rejected our amendment which would have ensured that there was proper oversight for energy trading. So I don't think this energy bill will do a single thing that assures me that we won't have another crisis in my state. The Senate also had the opportunity to pass legislation to increase fuel economy standards. Senator Snowe and I introduced legislation last year that would have closed what is known as the SUV Loophole. That loophole allows SUVs and other light duty trucks to meet lower fuel economy standards than other passenger vehicles. The standard is 27.5 miles per gallon for cars and 20.7 miles per gallon for SUVs. Our bill would have saved a million barrels of oil a day, reduced our dependence on foreign oil by 10 percent, and prevented more than 200 million tons of carbon dioxide from entering the atmosphere each year. It was the single most important thing our country could have done not only to combat global warming, but to become more fuel-independent at the same time. I regret that we did not have the opportunity to vote on this measure as the Senate instead overwhelmingly defeated a much more ambitious proposal to significantly raise standards for all vehicles. I am convinced that had we not done that, the Feinstein-Snowe amendment would have had a real shot at winning. By a longshot however, the ethanol mandate is the most troublesome provision in the Senate energy bill. What was also sneaked into this bill without a hearing was essentially a new gas tax that will result in a wealth transfer from California and New York and other coastal States to States in the Midwest. It actually triples the ethanol market by mandate. And if a State does not need it, it forces that State to buy credits to pay for it. In fact, the mandate extorts California to use 2.68 billion gallons of ethanol over nine years that it does not need. All this for a substance that is already subsidized to the tune of 53 cents per gallon and protected from any foreign competition through significant tariffs. No one knows for sure how much gas prices will increase because of this mandate. One recent analysis indicates that prices will increase 4 to 10 cents per gallon across the United States if the Senate energy bill becomes law. I believe that the price spikes in California will be even more severe beginning in about 2004 as our State is close to our refining capacity and using ethanol will shrink our gasoline supply and force us to refine more. California also does not have the necessary infrastructure in place to transport the ethanol to market. I am particularly concerned about the limited number of suppliers in the ethanol market. In fact, one company ADM controls 41 percent of the market. And of course, nobody really knows the long-term health and environmental effects of nearly tripling the amount of ethanol in our gasoline supply. Some evidence suggests that (1) reformulated gasoline with ethanol produces more smog pollution than reformulated gas without it; and (2) ethanol enables the toxic chemicals in gasoline to seep further into groundwater and ever faster than conventional gasoline. But just like when we introduced MTBE into our gasoline we simply don't know what the ramifications will be. And of course to top it off this bill protects these energy producers from any future liability. And the funniest thing of all is that all this is for a gasoline additive that California and other States hardly need. With the exception of the winter months in some of the southern part of the State, California can meet all its Clean Air Act Standards with its own reformulated gasoline. In actuality we need to use very little ethanol. So that is why I strongly oppose this bill and I believe we will rue the day we passed this ethanol mandate and this energy bill.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Mr. President, I rise today to pay tribute to a great Californian, Chauncey Veatch, whom I am very proud to know. Chauncey Veatch has been bestowed the highest honor available to teachers; he has been named the 2002 ``Teacher of the Year.'' I have had the honor of meeting Chauncey Veatch on two occasions. First when he became California's Teacher of the Year, and then again today. I could tell from my first meeting with Mr. Veatch that California was lucky to have a teacher like him in the State. His love for teaching and genuine concern for his students was apparent from the way he spoke about his classroom, students, and community. Mr. Veatch did not always know he wanted to be a teacher. He came to teaching later in his career. He first spent 22 years in the Army infantry and medical services corps, working as a medical administrator. After retiring in 1995, Mr. Veatch decided to follow in his siblings footsteps and become a teacher. He currently teaches social studies at Coachella Valley High in Thermal, California. The overwhelming number of his students come from migrant families, and nearly all of his students are Spanish-speaking. Mr. Veatch speaks Spanish to communicate with many of his students and to show respect for their culture. His students and colleagues know Mr. Veatch as a courteous, tireless worker. He goes the extra mile for his students and his community. It is not uncommon for Mr. Veatch to spend hours after school helping students get caught up on their course work or to get ahead. One of his migrant students had to work with his family until November. A place was saved for him in the classroom, and Mr. Veatch worked with him everyday after school to make sure he caught up with the rest of the class. This is just one example of the many students he has helped. Mr. Veatch's former principal, Rick Alvarez, said of his colleague: ``Believing our students can succeed is not a desire or a facade, but is actually something Chauncey lives. This caring can be seen in his eyes and heard in his voice and felt in his presence, and mostly seen in his actions.'' Chauncey Veatch said in the Rose Garden yesterday as President Bush presented him with his award, ``If you'd like to be a part of America's tomorrows become a teacher today.'' Mr. Veatch is a living example of the difference each person can make in the life of a child. Along side him at the ceremony were two of his students whose lives he has touched and undoubtedly changed. His students are his legacy, as he commonly refers to them as his ``kids.'' Through his actions, it is apparent to me that the terms ``kids'' is not only used a word to describe his classroom, but really how he thinks of his students. They are like family. From Army Colonel to ``Teacher of the Year,'' I am proud to know you Chauncey Veatch and to call you a Californian. In Mr. Veatch's words, ``There is nothing more rewarding, nothing more patriotic than teaching. It is truly a joy and honor to be a teacher. This award belongs to my students.''

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Madam President, it is my pleasure to rise in support of the nominations of Percy Anderson and Jack Walter for the District Court of the Central District of California. Mr. Anderson and Mr. Walter are the first nominees to come out of California's new bipartisan Judicial Advisory Committee, which Senator Boxer and I established with the cooperation and agreement of the White House. It is testament to the qualifications of both Mr. Anderson and Mr. Percy that each of these nominees was unanimously endorsed by the bipartisan advisory committee. Moreover, the Judiciary Committee unanimously approved their nominations. The process that led to these nominations is representative of how the system can work, and should work, to produce highly qualified judicial candidates. This process should serve as an example to other states as they too, work with the White House to develop nominating systems. Now, I would like to describe the nominees. Mr. Anderson, a resident of Inglewood, CA, has spent his entire 25- year legal career practicing law in southern California including a 6- year stint as an Assistant U.S. Attorney and 15 years in private practice. He is currently a partner at the firm of Sonneschein, Nath, and Rosenthal, where he specializes in commercial litigation and criminal defense. Judges and private practitioners in the Los Angeles area consistently praise Mr. Anderson for his legal acumen, high ethical standards, and professionalism. The other nominee we will vote on this morning is Jack Walter, a resident of Pacific Palisades, CA. Mr. Walter's credentials are equally outstanding. Since 1976, Mr. Walter has practiced criminal and civil litigation in a firm he co-founded, Walter, Firestone & Richter in 1976. Over the years, Mr. Walter has represented over 75 indigent defendants who were charged with crimes in Federal court. Mr. Walter has also served as a judge pro tempore in the Santa Monica Municipal Court for over 5 years. Mr. Walter has legions of supporters in the legal community, including Customs Commissioner Robert Bonner. The ABA rated Mr. Walter as ``Well-Qualified,'' its highest rating. Before concluding, I want to stress to the Senate how urgent it is to fill these vacancies in the Central District of California. With six vacancies, the Central District has one of the most acute shortages of unfilled judgeships of any court in the country. The Administrative Office of the U.S. Courts has designated four of these vacancies as ``judicial emergencies.'' With the nominations of Percy Anderson and Jack Walter, we are taking a much-needed step forward to alleviate the vacancy crisis in the Central District. In conclusion, I want to thank Senator Leahy for his expedited review and fair handling of these nominees.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. Madam President, I rise today to acknowledge and commemorate the 87th anniversary of the beginning of the Armenian Genocide. I do so every year because the lessons of the past must not be forgotten and the crimes of the past must not be repeated. On April 24, 1915, the Ottoman Empire launched a brutal and unconscionable policy of mass murder. Over an 8-year period, 1.5 million Armenians were killed, and another 500,000 were driven from their homes, their property and land confiscated. As Americans, as sons and daughters of liberty, justice and freedom, we must raise our voices and acknowledge this terrible crime to ensure that it does not happen again. Those who would single out men, women, and children to be killed solely on the basis of their race, ethnicity, and religion must know that the United States and the international community will not allow their crimes to go unpunished. We have seen the crimes of the Armenian Genocide repeated far too often in this century: in Germany, in Cambodia, in Rwanda, and in Bosnia. We have stood by and remained silent. Let us commemorate this occasion and state loud and clear: Never again. Even as we remember the tragedy and honor the dead, we also honor the living. Half a million Armenian Americans reside in my home State of California and I am proud to be their representative in the U.S. Senate. They have overcome the horrors of the past to build a better future for themselves and their families in the United States. They are a testament to hard work, dedication, and perseverence and they have greatly enriched the culture and civic life of our State. Let us remember the Armenian Genocide. Let us ensure that those who suffered did not die in vain. Let us rededicate ourselves to cause of human rights for all. Let us work together with Armenia and the Armenian American community to create a future filled with hope and possibility.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. My question is, Is the Senator saying, then, that the credits in this bill do not say if you do not use it you have to pay for it?

Mrs. FEINSTEIN. Since the majority leader attacked the points I made, I would like to have an opportunity to respond.

Mrs. FEINSTEIN. I thank the Chair.

Mrs. FEINSTEIN. These documents were just disclosed in a House hearing this afternoon. They were disclosed to the FTC. What they show are competitors in the ethanol industry sharing bidding information to rig bids. One memo describes bringing European ethanol and laundering it through the Caribbean to avoid the tariff. These are hearings that are now going on in the House. I cannot, in the 5 minutes I have had these documents, have an opportunity to really confirm to anybody what they do or what they don't do. There are a number of suggestive comments in them, such as one company saying to the other: We are prepared to stop bidding should the price drop below $1.38 a gallon. Interestingly enough, this all concerns ethanol going into your State, Washington, Madam President, a few years ago. Whether this shows price manipulation or not, I don't know. But because these documents have just been made public this afternoon in the House, I ask unanimous consent to print them in the Record.

Mrs. FEINSTEIN. Will the Senator yield?

Mrs. FEINSTEIN. Madam President, I would like to sum up on behalf of the sponsors of this amendment. The amendment deletes this particular renewable fuel mandate from the bill. This is a tripling of ethanol. It may be fine in the Midwest where all the facilities that produce ethanol are located, but for those of us on the west coast and those of us on the east coast, it is truly egregious. One of the reasons it is egregious is that we don't have the infrastructure to really accept it. Another reason is that, for many of us, our gasoline is already reformulated and already meets clean air standards and therefore we are forced to use a specific product, ethanol, way in excess of what is necessary. Sure, we want to be relieved from the MTBE oxygenate requirement. But to replace it with a renewable fuels requirement that mandates a tripling of this additive on States that do not need it imposes some very substantial detriments. I would like to read from the letter from the Governor of California. I know there are a lot of people who are experts on California in this body, but I think the Governor's position also bears scrutiny. He points out that: While the [California Energy Commission's] Fall 2001 survey indicated that there may be adequate ethanol production capacity in the Midwest to meet California demand, both the [California Energy Commission] and its independent experts concluded that the infrastructure necessary to deliver ethanol and distribute it within California is not in place. Specifically, they pointed out the following problems: Lack of unit-train off-loading facilities for ethanol in California; lack of storage tanks at distribution terminals; inadequate rail and marine capacity for handling ethanol; inadequate facilities to transport ethanol from marine terminals to inland distribution points. Furthermore, the two-year delay in the decision by the federal government on California's request for a waiver of the oxygenate requirement has delayed completion of the infrastructure changes necessary to make a successful transition to ethanol within our current timeframe. It also goes on to point out that: California's Air Resources Board reformulated fuel standards--so critical to California's air quality--make it nearly impossible to replace gasoline with supplies from other states. In 2004 and 2005, a more stringent federal reformulated fuel standard begins to phase in, which will make it easier to import cleaner burning gasoline from other states and maintain California's strict air quality standards. The point is, we can do a lot of this without tripling of ethanol. The letter goes on to point out California has: Limited refining capacity--California refineries have been running at operating rates approaching 95 percent of their nameplate capacity which, in effect, means California's refineries are operating at maximum levels now. Without new capacity, California cannot replace the volume lost by replacing MTBE with ethanol. In 2005, the Longhorn pipeline and other pipeline projects will be completed, freeing up California fuel that is now being shipped to Arizona. The point of this is that ethanol absorbs more gasoline. It needs more gasoline. MTBE needs less gasoline. California's refining plants are at capacity. Therefore, it cannot refine enough gasoline to take the amount of ethanol that we are required to take under this bill. That is the rub. It is a kind of strict mandated formula all across the Nation. I can't believe people think this is good public policy. I can't believe people think the lack of flexibility in this policy is good for all States. Every State is in a different position with respect to ethanol. Some can absorb it. Some can't. Some need it. Some don't. It seems to me that the key is the clean air standards in the Clean Air Act. If you can meet those clean air standards in other ways, good policy would allow a State to have that capacity. This, in essence, is a selfish public policy. It is selfish just for a specific area of the United States that produces it, that has the plants there, that has the producers there, and, therefore, has adequate supply and adequate infrastructure. That is why we will move to delete this from the bill. Obviously, we don't expect to win it, but we expect to make the case. And I believe we have. After this amendment is considered, it will be my intent--if I need to wait, I will wait--to call up the 90-day waiver amendment, which Senator Daschle has offered, and also the amendment which would produce a 1-year delay in the mandate which Senator Daschle has said he is agreeable to, and see what happens with these two amendments. By and large, as somebody who has been in public life for 30 years now, as a lifelong Californian, to be part of a body that places my State in this kind of jeopardy in terms of loss of revenues from the highway trust fund, which is probably the most vital Federal appropriations we have, from a State that produces much more in taxes than we get back in services from the Federal Government, and to create a loss in the highway trust fund, and in all probability a gas tax hike--the Senator from Iowa particularly criticized us using a study to show the gas tax. The reason we don't agree with the Energy Information Office study is because the Energy Information Office study does not account for problems with infrastructure or market concentration as criteria in evaluating any impact that this would have on increased fuel prices. I see the Senator from New York on the floor. I know he wishes to sum up as well.

Mrs. FEINSTEIN. Mr. President, I appreciate an opportunity to respond. The majority leader might want to listen or he might not want to listen. What he said might be true if one needed to use an oxygenate, but California does not need to use an oxygenate because it has a reformulated gasoline, and it has to use just a limited oxygenate. This bill forces California to use this much that it does not need, and a careful reading of the credit trading provision in this bill means you either use this ethanol or you have to pay for it. Let me respond to another point he made on the issue of increased gas prices. He said we use one study. Let me give another study. This is an EPA staff white paper, study of unique gasoline blends, effects on fuel supply and distribution and potential improvements: Replacing the RFG oxygenate mandate with the renewable fuel mandate will result in a shift of ethanol use from RFG to conventional gasoline, while ethanol distribution costs and blending costs should decrease. However, this will be offset to some extent by an increase in ethanol production costs. For the purpose of this study, we have assumed, based on previous analyses, as discussed in the cost memorandum in the docket, that ethanol production costs would be increased by 15 cents per gallon relative to today's ethanol prices. So it shows there that the cost of ethanol is apt to go up. With respect to the study that he mentioned, the Energy Information Administration report, that report used national averages. It does not adequately predict gas prices in California and other States. The report he referred to did not model how infrastructure problems and market concentration can drive prices up. So, what California is saying is we will not have the infrastructure in place, and that alone will create price spikes. With respect to his comment on the 90-day amendment, the majority leader knows I have been interested in this for a long time. A 90-day waiver has never, ever, by anyone, been offered to me. I will be very happy at the appropriate time to call up my amendment, which is a 90- day waiver. I hope, then, that that 90-day waiver will be agreed to. But at no time was a 90-day waiver ever mentioned to me. I thank the Chair.

Mr. FEINSTEIN

Mr. FEINSTEIN. That is exactly correct, because of the subsidy on ethanol, usually 18 cents a gallon, which goes into the highway trust fund. With ethanol, it drops to 13 cents a gallon. That is a $7 billion take from the highway trust fund over the years of this bill.

Mrs. FEINSTEIN

Mrs. FEINSTEIN. I thank the Chair and yield the floor.

Mrs. FEINSTEIN. Mr. President, this amendment would say that in an emergency, instead of having to wait 240 days for the EPA to respond, either to serious harm to the economy or an inadequate domestic supply or distribution capacity to meet the requirements of the mandate, the EPA would have 90 days to consider that. I ask unanimous consent this amendment be set aside.

Mrs. FEINSTEIN. Mr. President, I call up, for the purposes of setting them aside, two amendments. The first one is amendment No. 3225, and I ask the clerk to report the amendment.

Mrs. FEINSTEIN. Mr. President, I withdraw amendment No. 3115.

Mrs. FEINSTEIN. Mr. President, all this amendment would do is provide 1 additional year to prepare for the mandate. That would change one date, changing this mandate from 2004 to 2005. And I ask unanimous consent the amendment be set aside.

Mrs. FEINSTEIN. Mr. President, I call up amendment No. 3170, and I ask the clerk to report the amendment.

Mrs. FEINSTEIN. Mr. President, I ask unanimous consent reading of the amendment be dispensed with.