March 25, 2002

CONGRESS IN RECESS; TALK TO YOUR SENATOR ABOUT RFS

SIGMA and our allies continue to work diligently to remove the “Renewable Fuel Standard” (RFS) from the Senate version of the energy bill which is currently under consideration. That is the proposal to mandate the use of 5 billion gallons a year of ethanol or other renewable fuels such as biodiesel. Despite efforts of proponents to present the RFS as a “done deal”, it is far from it. There are three ways the RFS could be defeated:

* It could be removed from the bill, or significantly altered, by amendment in the Senate. There are reports that several Senators are considering introducing such amendments, and SIGMA is working with them. This is the ONE option where your help is needed! Congress is in recess for the next two weeks, so now is an excellent time to reach Senators in their home state offices. CALL, FAX, or E-MAIL to them – there isn’t enough time for “snail-mail” letters. Encourage them to oppose the Renewable Fuel Standard in the energy bill. Point out how much it will cost consumers, for little if any benefit to the environment.

* The entire energy bill could be withdrawn from consideration, or it could be defeated in the Senate. From a marketers’ perspective, worse things could happen. There are many controversial issues still to be resolved in the bill, such as drilling for oil in the Alaska National Wildlife Refuge (ANWR). Last week, Sen. Daschle attempted to force a vote on the Republican proposal on ANWR, hoping to defeat it, but was unable to muster the votes needed to bring it up. An overall energy bill without an ANWR provision may not be supported by Republicans; many Democrats would vote against a bill that did contain an ANWR drilling provision. There are also provisions that have been resolved that may stick in the craw of some Senators, and lead them to oppose the overall bill. For example, Democrats defeated 3 amendments in the electricity section of the bill which would have weakened a mandate for 10% of electricity to be generated through renewable fuels such as wind and solar by 2020. For this possibility, there is little SIGMA or our members can do except “wait and see.”

* The third very real possibility is that the RFS would be removed from the bill, or substantially altered, during a conference committee working out differences between the House and Senate versions of energy legislation. SIGMA and our allies will be prepared to work this option, if it comes to that. If the Senate passes an energy bill, only then will we even know who will be on the conference committee from the two houses.

So again we ask you . . between now and April 8, when Congress comes back to DC, contact your Senators in ALL states in which you do business and urge them to oppose the Renewable Fuel Standard (ethanol mandate) in the energy bill now before the Senate! A sample letter can be found at by clicking here and going to the end of that report.

TANK DEVELOPMENTS

Tank language in the Senate energy bill isn’t much of a problem (one small “tweak” would resolve a minor wording problem), but the bill doesn’t address the issues SIGMA and our members care most about. For that, it appears that a free-standing bill will be necessary. We continue to follow up from the hearing on S. 1850 held by Sen. Chafee (R-RI). Although no notice has been issued, we understand that Sen. Boxer (D-CA) will likely hold a hearing on April 25 before the Subcommittee she chairs. Work is also ongoing on the House side, where no bill has been introduced yet. Staff for Rep. Gillmor (R-OH) indicate there may be a tank oversight hearing early in April; again, no formal notice yet.

MARKET STRUCTURE

SIGMA will be distributing by mail a large packet of materials which will form the basis for our Legislative Committee’s discussions on market structure issues including predatory pricing and inversions. The mailing, scheduled to go out Tuesday or Wednesday, will go to all Regular Member “key contacts” as well as to all other individuals already registered for the Spring Convention in San Antonio, April 25-28. The Legislative Committee meets on the morning of April 26. If you’re not yet registered, DO IT TODAY! Incidentally, the resort has extended until April 5 the deadline for reserving your room at the special SIGMA rate.

SMALL REFINER TAX INCENTIVES

The Chief Counsel for Advocacy of the Small Business Administration has come out in favor of the tax incentives to help small refineries comply with the coming diesel desulfurization rules. SIGMA has pushed for these incentives, which are contained in energy tax legislation pending before Congress. The letter was dated March 19 and was sent to Sens. Daschle (D-SD) and Lott (R-MS), backing sections 504 and 505 of S. 1979.

SBA TO WORK WITH OIRA

The Office of Information and Regulatory Affairs (OIRA) is the agency within White House which reviews regulations before other agencies can approve them. OIRA has signed a new Memorandum of Understanding with the SBA’s Office of Advocacy, pledging to work together to ensure that small business concerns are heard early in the regulatory process, not just at the end. For more details, visit the SBA website at www.sba.gov/advo .

SIGMA STATISTICAL REPORT

Last call for the SIGMA Statistical Survey – we start writing the report on Wednesday, March 27. If you haven’t returned your company’s form yet, please fax it TODAY to Jeff Leiter at 202-342-8451. Thanks!

USTFIELDS MADE PERMANENT

A pilot program developed by EPA’s Office of Underground Storage Tanks last year has been made permanent under legislation passed by Congress and signed into law Jan. 11. In the past, EPA’s “brownfields” program provided money for cleanup and redevelopment of petroleum-contaminated “superfund” sites where petroleum contamination was not the only problem. Under the “USTfields” program, that limitation is removed. This will open the way for local governments to seek redevelopment of abandoned gas station sites that have contamination problems.

WATCH YOUR MAIL FOR . . .

. . . registration information for this summer’s George Overstreet program in Charlottesville, July 9 - 12. Mailing is going out this week. Save $800 for CEO and CFO signing up together before April 5!

. . . registration and early information on next year’s Winter Management Conference in Vail! That’s right. While you still have skiing on the mind, make your plans for next winter’s retreat. Forms should reach you in about 2 to 3 weeks.