Don Nickles

Mr. NICKLES

Mr. NICKLES. Mr. President, I ask unanimous consent for 60 seconds.

Mr. NICKLES. I compliment my colleague from North Carolina for his work on the State Department reorganization bill. He has worked on it for years. He has done good work. It will save taxpayers a lot of money and make the State Department more accountable and do a better job. We have heard colleagues on the other side say, I will not support it because of the so-called abortion provision. The only thing in this bill that deals with abortion is that it basically says we don't want to have U.S. money used to lobby other countries to change their laws. What in the world makes people think that we are so right on abortion, this administration's philosophy is so right on abortion, we should be lobbying other countries to change their position? Some countries are pro-life. They have it in their constitution; they have it in their legislature. Why should U.S. tax money be used to lobby those countries to change their laws? That is a serious mistake--a serious mistake. I heard somebody say we haven't changed Mexico City policy. There is no restriction in here. These International Planned Parenthoods can use their money for abortions overseas. That is not even in this. The only restriction is, anybody that received nongovernmental entity can't use money to lobby other countries to change their laws and influence other countries on abortion. I don't think we should do that. We certainly shouldn't have U.S. tax moneys doing that. I think this is a decent compromise. I urge my colleagues on both sides of the aisle to pass this.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from North Carolina (Mr. Faircloth), the Senator from New Hampshire (Mr. Gregg), the Senator from Oklahoma (Mr. Inhofe), and the Senator from Alaska (Mr. Murkowski) are necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Arizona (Mr. McCain), the Senator from Utah (Mr. Bennett), and the Senator from Kansas (Mr. Brownback) are necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Arizona (Mr. McCain) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Colorado (Mr. Campbell) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from North Carolina (Mr. Helms) is necessarily absent.

Mr. NICKLES. I announce that the Senator from North Carolina (Mr. Helms) is necessarily absent.

Mr. NICKLES. I announce that the Senator from North Carolina (Mr. Helms) is necessarily absent. THE PRESIDING OFFICER. Are there any other Senators in the Chanber who desire to vote?

Mr. NICKLES. I announce that the Senator from North Carolina (Mr. Helms) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. I appreciate my colleague's response. I said, How much is it going to cost? She said it is in the President's budget. The President's budget says we will spend $7.3 billion to hire an additional 100,000 teachers. It doesn't really define in the budget how that is going to be done. My colleague from Washington said it is going to be done like we did community policing. He has a goal to hire 100,000 community police. When that started out, it was 100 percent or 75 percent Federal, and then 50 percent Federal, and then 25 percent Federal each succeeding year, and the individual communities had to pick up the greater costs. I laugh at that. A lot of communities are saying, ``We like the program when the Federal Government is paying all of it. We don't like it when we have to pay all of it.'' Then I asked my communities in the State, I went around to several communities--I am sure several of my colleagues did--and said, ``Are you going to get one of these teachers? Is your school going to get a teacher? Is your school going to get a teacher? Who is going to be lucky enough to get the Federal teacher?'' I don't think it makes any sense. Do I want smaller class size? I would say, in general, yes. Do I think the Federal Government should mandate it, should pay for it? The answer is no. I think the solution is, as our Senator from Washington said, let's give the money and power and control back to the States, and if they want smaller class size, they can make that decision. If they want new buildings, they can make that decision. If they want new computers, they can make that decision. We should not try to say, ``Oh, we think this classroom should have another teacher. We are going to have a Federal teacher here and have the Federal Government pay 75 percent of it or 50 percent of it for the first year.'' I just don't think it makes sense. I don't think it is affordable. The $7.3 billion the President had in his budget was financed on the so-called tobacco deal, and we don't even know whether or not it is going to happen. So I urge my colleagues to support the amendment of my friend and colleague from Arkansas saying that 95 percent of this money should go directly to the classroom. I urge my colleagues not to say we should be dictating to the States how, and put Federal teachers or federally-paid-for teachers in the schools. I think it would be a serious mistake. If we want to have a sense of the Senate, ``Hey, we urge you to have smaller class size,'' and leave it to the States, fine. But the implication of the amendment of the Senator from Washington is that we need to have the President's program, we need to have the Federal Government writing checks for teachers in individual school districts, and I think that is a mistake.

Mr. NICKLES. Will the Senator yield?

Mr. NICKLES. I ask unanimous consent that each side have an additional 2 minutes to discuss this issue.

Mr. NICKLES. The question to my colleague from Washington is: How much does your proposal cost, and are these going to be Federal teachers? Are they going to be paid for entirely by the Federal Government or partly by the State government? What is the cost allocation?

Mr. NICKLES. Will the Senator yield for a question?

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. I announce that the Senator from Utah (Mr. Bennett) is necessarily absent.

Mr. NICKLES

Mr. NICKLES. Mr. President, I would like to announce for the information of the Senate and the public that a hearing has been scheduled before the Subcommittee on Energy Research, Development, Production, and Regulation of the Committee on Energy and Natural Resources. The hearing will take place Thursday, May 21, 1998 at 2:00 p.m. in room SD-366 of the Dirksen Senate Office Building in Washington, D.C. The purpose of this hearing is to receive testimony on S. 1141, the Biodiesel Energy Development Act of 1997; and S. 1418, the Methane Hydrate Research and Development Act of 1997. Because of the limited time available for the hearing, witnesses may testify by invitation only. However, those wishing to submit written testimony for the hearing record should send their testimony to the Subcommittee on Energy Research, Development, Production, and Regulation of the Committee on Energy and Natural Resources, United States Senate, 364 Dirksen Senate Office Building, Washington, DC 20510-6150. For further information, please contact Shawn Taylor at (202) 224- 1219 or Howard Useem of the Committee staff at (202) 224-6567.

Mr. NICKLES

Mr. NICKLES. Mr. President, once again, our domestic oil and gas producers are facing devastating losses due to a significant drop in oil prices. This crisis creates a dangerous situation for the industry and for our national security. Unfortunately, the policies and practices of the Administration have exacerbated the problem, not helped. If we are to maintain a viable domestic petroleum industry, we must reverse these practices. An important step towards this end is reforming the Department of Interior's erratic, ever-changing royalty valuation practices. The Royalty Enhancement Act, that I am introducing today, will reduce regulatory costs and promote development of federal oil and gas resources vital to our national security. It will also significantly reduce the administrative costs associated with the federal royalty payment system. Minerals Management Service (MMS), the agency within the Department of Interior given responsibility for administering royalties from federal leases, has imposed on oil and gas producers a bureaucratic labyrinth of rules and regulations. One of the most fundamental concepts of our society is the ability of any citizen, in particular, citizens who are parties to contracts with the federal government to be assured that the Federal government will not overreach and unilaterally interpret those contracts. Such a situation is what we have today with oil and gas producers who have contracted with the Federal government to expend their capital and resources to explore for, drill and produce valuable oil and gas reserves in the United States and offshore. In the past few years oil and gas producers, both independent and major, have become increasingly frustrated with the unwillingness by MMS to produce a simplified and certain valuation method that accurately captures the value of oil or gas at the lease. This is the value that a federal oil and gas lessee owes and the American taxpayer deserves to be paid. Recently, the MMS has proposed a new oil valuation rule which is the most administratively burdensome and complex method, available to the government. This new rule looks like the Clinton health care plan and makes the IRS code look simple. In short, the current MMS valuation system is badly broken and their outstanding oil proposal will only make it worth. In 1995, I introduced the Federal Oil and Gas Royalty Simplification and Fairness Act because of the importance of federal royalty revenues to the United States Treasury and States. The purpose of that legislation was to streamline and simplify the royalty management program for the over 20,000 federal lessees who are required to file over 3,000,000 reports annually. Despite the bipartisan support for my bill, MMS resisted this much needed reform during the entire legislative process. Fortunately, Congress saw the wisdom and need for the law and sent it to the President and it became effective in August, 1996. Why is Congressional action needed, Mr. President? Despite the obvious importance of the oil and gas industry to our national economy and global stability, the MMS has failed to get the message we sent them in 1996 that the American people can no longer tolerate their ineffective and inefficient bureaucracy. The MMS valuation rules contain complicated formulas that can be both confusing and inaccurate. These ambiguous rules lead inevitably to expensive disputes and litigation that unnecessarily drain resources of the federal government and the lessees. To ensure that the American people receive their full and fair value of production royalties from oil and gas produced on federal lands, we need to create a royalty valuation system that provides certainty, simplicity and fairness to the federal government, States, oil and gas producers and the American taxpayers. Only by doing this will companies want to take the risk of spending their capital to develop and produce federal oil and gas for our nation's use and benefit. It is important that we maintain the viability of existing production on federal lands and encourage development of the new frontiers of production in the deep waters off our coastlines. Mr. President, my colleagues from New Mexico, Alaska, Texas and Louisiana, Senators Domenici, Murkowski, Hutchison and Breaux, join me today in introducing the Royalty Enhancement Act which is the Senate companion of H.R. 3334, a bill introduced this session by Congressman Thornberry. This bill cuts through the horrendously complicated and ambiguous current rules and provides certainty, simplicity and fairness to both the taxpayers and the companies who enter into oil and gas leases with the federal government. This legislation will replace the current complicated and complex system of royalty valuation with a much clearer, simpler method of royalty payment that would avoid valuation disputes. This method will allow companies to pay the federal government its royalty share in actual barrels of oil or cubic feet of natural gas. The bill contains a comprehensive well-designed royalty payment method that will streamline auditing and accounting systems for both the government and the producers and will reduce administrative costs. Reduced costs will help keep production economic for a longer period, extending the life of producing wells and thus providing more royalties from this continued production. The best way to be absolutely certain that the government receives fair market value at the lease is for the government to take production in-kind and have it marketed and sold by qualified private sector marketers who possess the expertise and experience to receive the best value for the United States. Mr. President, it is not fair to subject companies who produce oil and gas on federal lands to the whim of the MMS with their record of retroactive second-guessing of valuation years after oil and gas has been produced and sold. It is fundamentally unfair to the American people for the agency's uncertain and ambiguous rules and practices to create delay in receipt of royalty revenues to the Treasury and to bear the expense of the government's bureaucracy. For these reasons, I am introducing the Royalty Enhancement Act of 1998. Mr. President, I ask unanimous consent that the bill be printed in the Record.

Mr. NICKLES

Mr. NICKLES. Mr. President, once again, our domestic oil and gas producers are facing devastating losses due to a significant drop in oil prices. This crisis creates a dangerous situation for the industry and for our national security. Unfortunately, the policies and practices of the Administration have exacerbated the problem, not helped. If we are to maintain a viable domestic petroleum industry, we must reverse these practices. An important step towards this end is reforming the Department of Interior's erratic, ever-changing royalty valuation practices. The Royalty Enhancement Act, that I am introducing today, will reduce regulatory costs and promote development of federal oil and gas resources vital to our national security. It will also significantly reduce the administrative costs associated with the federal royalty payment system. Minerals Management Service (MMS), the agency within the Department of Interior given responsibility for administering royalties from federal leases, has imposed on oil and gas producers a bureaucratic labyrinth of rules and regulations. One of the most fundamental concepts of our society is the ability of any citizen, in particular, citizens who are parties to contracts with the federal government to be assured that the Federal government will not overreach and unilaterally interpret those contracts. Such a situation is what we have today with oil and gas producers who have contracted with the Federal government to expend their capital and resources to explore for, drill and produce valuable oil and gas reserves in the United States and offshore. In the past few years oil and gas producers, both independent and major, have become increasingly frustrated with the unwillingness by MMS to produce a simplified and certain valuation method that accurately captures the value of oil or gas at the lease. This is the value that a federal oil and gas lessee owes and the American taxpayer deserves to be paid. Recently, the MMS has proposed a new oil valuation rule which is the most administratively burdensome and complex method, available to the government. This new rule looks like the Clinton health care plan and makes the IRS code look simple. In short, the current MMS valuation system is badly broken and their outstanding oil proposal will only make it worth. In 1995, I introduced the Federal Oil and Gas Royalty Simplification and Fairness Act because of the importance of federal royalty revenues to the United States Treasury and States. The purpose of that legislation was to streamline and simplify the royalty management program for the over 20,000 federal lessees who are required to file over 3,000,000 reports annually. Despite the bipartisan support for my bill, MMS resisted this much needed reform during the entire legislative process. Fortunately, Congress saw the wisdom and need for the law and sent it to the President and it became effective in August, 1996. Why is Congressional action needed, Mr. President? Despite the obvious importance of the oil and gas industry to our national economy and global stability, the MMS has failed to get the message we sent them in 1996 that the American people can no longer tolerate their ineffective and inefficient bureaucracy. The MMS valuation rules contain complicated formulas that can be both confusing and inaccurate. These ambiguous rules lead inevitably to expensive disputes and litigation that unnecessarily drain resources of the federal government and the lessees. To ensure that the American people receive their full and fair value of production royalties from oil and gas produced on federal lands, we need to create a royalty valuation system that provides certainty, simplicity and fairness to the federal government, States, oil and gas producers and the American taxpayers. Only by doing this will companies want to take the risk of spending their capital to develop and produce federal oil and gas for our nation's use and benefit. It is important that we maintain the viability of existing production on federal lands and encourage development of the new frontiers of production in the deep waters off our coastlines. Mr. President, my colleagues from New Mexico, Alaska, Texas and Louisiana, Senators Domenici, Murkowski, Hutchison and Breaux, join me today in introducing the Royalty Enhancement Act which is the Senate companion of H.R. 3334, a bill introduced this session by Congressman Thornberry. This bill cuts through the horrendously complicated and ambiguous current rules and provides certainty, simplicity and fairness to both the taxpayers and the companies who enter into oil and gas leases with the federal government. This legislation will replace the current complicated and complex system of royalty valuation with a much clearer, simpler method of royalty payment that would avoid valuation disputes. This method will allow companies to pay the federal government its royalty share in actual barrels of oil or cubic feet of natural gas. The bill contains a comprehensive well-designed royalty payment method that will streamline auditing and accounting systems for both the government and the producers and will reduce administrative costs. Reduced costs will help keep production economic for a longer period, extending the life of producing wells and thus providing more royalties from this continued production. The best way to be absolutely certain that the government receives fair market value at the lease is for the government to take production in-kind and have it marketed and sold by qualified private sector marketers who possess the expertise and experience to receive the best value for the United States. Mr. President, it is not fair to subject companies who produce oil and gas on federal lands to the whim of the MMS with their record of retroactive second-guessing of valuation years after oil and gas has been produced and sold. It is fundamentally unfair to the American people for the agency's uncertain and ambiguous rules and practices to create delay in receipt of royalty revenues to the Treasury and to bear the expense of the government's bureaucracy. For these reasons, I am introducing the Royalty Enhancement Act of 1998. Mr. President, I ask unanimous consent that the bill be printed in the Record.

Mr. NICKLES

Mr. NICKLES. I move to lay that motion on the table. The motion to lay on the table was agreed to.