Teague, shown during a recent town hall meeting in Las Cruces. (Photo by Heath Haussamen)
Deal Teague worked to get support for House bill in exchange for provision that helps small refiners ‘is not nearly enough,’ one refiner says
U.S. Rep. Harry Teague, D-N.M., was instrumental in a deal with small refiners that helped controversial cap-and-trade legislation narrowly pass the House in June.
But that doesn’t mean those small oil and gas refiners want the bill to become law. The Hill is reporting today that small refiners who supported House passage of the American Clean Energy and Security Act currently oppose the legislation in the Senate.
AGE Refining CEO Glen Gonzales, one of 15 to sign a letter in June in favor of House approval of the bill, was quoted today by The Hill as saying that small refiners “remain deeply concerned that what the House has offered is not nearly enough.”
“We agreed only that the legislative process should move forward, with a view toward working subsequently with the Senate. We did not agree to support H.R. 2454,” Gonzalez was quoted by The Hill as saying.
Teague is facing a tough re-election battle next year against his predecessor, former U.S. Rep. Steve Pearce, R-N.M. Both are Hobbs oilmen, and the race, which has thus far focused largely on Teague’s vote in favor of the cap-and-trade bill, is currently one of the hottest House contests in the nation. Today’s news is sure to put further attention on the race and heat up the debate.
Teague, one of the key votes in favor of the bill, has often touted the provision he got added to the cap-and-trade bill, which he says would help small refineries in his district and around the nation. The provision added an extra 0.25 percent emissions allowance for small refineries, which could be used by the companies or sold to others.
The provision could mean an extra $5 billion for small refineries between 2014 and 2026, according to one analysis.
It was in exchange for that provision that the small refinery executives agreed to support House approval of the bill, which The Hill characterized as “providing some political cover to centrist Democrats on the fence.” The deal came about after the small refineries shared with Teague their concerns that they would be more vulnerable under the cap-and-trade proposal because they’re less able to absorb higher costs.
The issue, according to The Hill, “was of particular concern for Teague not only because of his background. Western Refining, a small refiner based in El Paso, Texas, operates two plants in New Mexico. Navajo Refining, meanwhile, operates one in Teague’s district.”
Ultimately, the bill passed the House by seven votes in late June.
Trying to improve relations between Dems, oil and gas
Teague spokesman Sara Schreiber said today, in response to The Hill article, that without Teague’s amendment, “that $5 billion would be passed on to consumers throughout New Mexico including those in Congressman Teague’s district. As you know, a majority of the gas that we buy in New Mexico is refined by small refineries.”
“In the end, this is an example of Congressman Teague doing what he always said he would — work to develop a better relationship between the oil and gas industry and Democratic leadership,” Schreiber said.
The Hill quoted the president of a trade group that includes “most” of the 15 small refiners who signed the June letter as now saying the group is united in opposing the bill in the Senate. Schreiber said those refiners “always intended on seeking further changes when the bill was negotiated in the Senate.”
“Basically, they accepted that the bill was going to pass the House and chose to advocate for changes in the House that put them in a better position moving forward,” she said.
Pearce and Washington Republicans sought to characterize today’s news as a shift for the small refiners.
“Now that the people who Harry Teague claimed to help are disowning his job-destroying bill, the question is will Harry Teague admit his support for cap and trade was a bad decision?” Pearce campaign spokesman Paul Ciaramitaro asked.
Rebecca Mark, spokeswoman for the National Republican Congressional Committee, said the small refiners “have discovered that Harry Teague’s provision, which he allegedly made on behalf of his former colleagues, is little more than an industry-killing tax.”
“What more should we expect from the congressman who hobnobs with out-of-touch Beverly Hills Democrat Henry ‘the Taxman’ Waxman — who developed the Democrat’s devastating national energy tax?” she asked.
Waxman, D-Calif., sponsored the cap-and-trade bill in the House along with Edward Markey, D-Mass.
Both sides helping Teague raise money
Waxman was one of the hosts of a Wednesday evening fundraiser for Teague in Pennsylvania. Smelling blood, the state GOP hammered him earlier this week.
“Teague’s decision to ally himself with the liberal faction of his party serves as the most recent example of a long string of betrayals felt by his constituents in the 2nd Congressional District,” Harvey Yates Jr., chairman of the state GOP, said in a news release. “Now that Teague is being rewarded for his loyalty, the real question is who does Teague represent, Henry Waxman and Nancy Pelosi or his own constituency?”
Executives from the small refineries Teague fought for during the cap-and-trade debate also showed their appreciation for Teague’s work. According to The Hill, they held fundraisers for the Democratic Party and Teague in June that brought in more than $10,000.
Gonzales was quoted by The Hill as saying that the Teague provision in the House bill does help “offset ineluctable (small-business refiners’) economics,” but said, “Overall, the bill greatly increases the likelihood that AGE Refining and other small-business refiners will close in the near term and severely harm fuel consumers in large geographic areas of the United States.”
Update, 2:15 p.m.
State GOP spokeswoman Janel Causey added to the criticism of Teague in this statement:
“The industry which Teague claimed to protect through his amendment to the cap-and-trade bill opposes the legislation because it will give foreign competitors an advantage, translating into higher costs and job losses in New Mexico. As evidenced by Teague’s fundraiser last night in Washington with the author of cap-and-trade, he is now trying to reap the benefits for supporting this disastrous bill. The real question is, does Teague stand by his conviction that passing this bill is good for New Mexico, even in the face of opposition from the very industry he uses to justify his support for this bill?”