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Fray Over Oil Pipeline, Payroll Tax Cut

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WASHINGTON – New Mexico lawmakers jumped into the congressional dispute over oil pipelines and payroll taxes Wednesday after the House approved a bill late Tuesday connecting the two issues.

The House voted 234-193, mostly along party lines, to extend the payroll tax cut but included a controversial provision that would speed up approval of the proposed Keystone XL oil pipeline from Canada to Texas.

Senate Majority Leader Harry Reid, D-Nev., predicted swift defeat of the bill in the Democratic-controlled Senate and condemned House Republicans’ decision to link the issues. It remained unclear late Wednesday whether the House bill would come to a vote in the Senate. Senate Minority Leader Mitch McConnell was delaying a vote late Wednesday, instead pressing for a vote on a massive government funding bill.

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Rep. Steve Pearce, R-N.M., said he supports both extending the payroll tax cut and building the pipeline. He defended House Republicans’ decision to link them in legislation.

“That’s the way this town works and it has for decades,” Pearce told reporters in a conference call Wednesday. “They want the tax cuts (extension), we want the pipeline and the jobs; let’s put them together, and we both get something we’re looking for.”

Delegation Democrats said the issues are unrelated.

“It (the pipeline proposal) has no business being in this bill; it’s a separate issue,” Sen. Jeff Bingaman, D-N.M., told the Journal.

The XL pipeline plan is under review by the Obama administration, which hasn’t said whether it supports the proposal. The State Department has recommended delaying a decision until 2013 to allow for environmental reviews. The House-passed bill would give Obama 60 days to make a decision on the pipeline’s construction. Republicans contend the pipeline would create jobs, although how many is in dispute.

Bingaman, chairman of the Senate Energy and Natural Resources Committee, said he does not flatly oppose construction of the XL pipeline, but he thinks it is “appropriate” to wait for environmental reviews and to determine whether changes to the pipeline’s path can be negotiated to satisfy those who object to current plans.

Meanwhile, the payroll tax cut is scheduled to expire Jan. 1. The tax cut affects about 160 million U.S. workers and is worth about $1,000 per year to the typical American household. Senate Democrats this month tried to pass their own version of a payroll tax cut extension, but it failed because it included a contentious provision to end tax cuts for Americans making more than $1 million a year.

Bingaman and Sen. Tom Udall, D-N.M., each suggested passing a separate bill extending the payroll tax cut. Udall said the extension is a “temporary measure” that would help the middle class weather current economic turmoil.

“We need to pass this extension so that taxes don’t increase for middle-class families at the beginning of the year, but in the long term we need a better fix,” Udall said.

Bingaman conceded Senate Democrats would need to make “adjustments and changes” to their own proposal to pay for the extension by rescinding the tax cuts for millionaires – the idea that failed in the Senate earlier.

Reps. Ben Ray Luján and Martin Heinrich, both D-N.M., objected to provisions in the House bill that would have reduced the amount of time the jobless could collect unemployment benefits and would have required seniors who make more than $80,000 annually to pay more for their health care under Medicare. They also opposed linking the pipeline issue to payroll taxes.

“Instead of asking the top 1 percent to pay even 1 cent more in order to prevent a tax hike on 900,000 New Mexicans, House Republicans want to place the burden on seniors who rely on Medicare and workers who are struggling to find a job,” Luján said.

“Instead of millionaires and billionaires paying their fair share in income taxes, Republicans would rather advance a partisan agenda and force middle-class seniors on Medicare to pay more for their health care,” Heinrich said.
— This article appeared on page A1 of the Albuquerque Journal

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