Senate leaders want to break up logjam blocking energy bill, but it may not be easy.

WASHINGTON -- Senate leaders this week are expected to try to break a political logjam that has kept the pending energy bill from coming to a vote in that chamber and is holding up action on three tax-exempt bond provisions.

But lobbyists said yesterday that chances for success are highly uncertain.

Senate action would mean that congressional leaders could reconcile the measure with the House energy bill, which contains one provision that would increase the supply of bank-qualified bonds and one that would loosen investment restrictions on nuclear decommissioning trust funds.

The Senate Finance Committee's version of the energy bill does not include the provision on bank-qualified bonds, but contains the nuclear trust fund provision. It also includes a rifle shot proposed by Sen. Bob Packwood, R-Ore., that would ease restrictions on certain utility bonds in the Pacific Northwest.

Since the finance panel approved the bill on June 17, three senators have held it back from coming to a vote in the full Senate. They object to two provisions in the bill unrelated to the bond proposals, and they are threatening to filibuster.

Tomorrow Senate Majority Leader George Mitchell, D-Maine, will attempt to silence those senators by having the Senate vote on whether to invoke cloture, or a limit on debate.

But Sen. Mitchell needs 60 votes to approve his cloture motion, and lobbyists said it remains unclear whether he will succeed.

"I think this bill is in serious trouble," said a lobbyist for an energy trade group. The lobbyist said staff members to the Senate Energy and Commerce committee are pessimistic about the bill's chances.

One of the controversial provisions would allow the federal government to perform geological testing on Yucca Mountain in Nevada to determine whether it would be an appropriate site for a nuclear waste dump. Nevada's two senators, Democrats Richard H. Bryan and Harry Reid, opppose the measure and have used various procedural tactics in addition to their filibuster threat to block the bill.

The other problem provision was added by the Senate Finance Committee and sponsored by Sen. John D. Rockefeller 4th, D-W. Va. It would impose a tax on coal companies to help finance health-care costs for a small group of retired coal miners. Sen. Malcolm Wallop, R-Wyo., has said he strongly objects to the provision, and he is supported by Bush administration officials.

Caught in the middle of this debate are the three bond provisions. The House bill's provision on bank-qualified bonds is designed to increase bank purchases of municipals by easing rules enacted in 1986. Under the law, banks may deduct 80% of the cost of carrying tax-exempt bonds only if they are purchased from issuers who expect to sell no more than $10 million annually. The provisions would raise that amount to $20 million.

Both the House bill and the Senate Finance Committee bill would end the requirement that nuclear decommissioning trust funds invest only in Treasury securities or tax-exempt municipal bonds. The House bill would also lower the funds' 34% tax rate to 20%.

Sen. Packwood's proposal would exempt certain types of bonds for hydroelectric facilities from the private-activity bond volume cap.

If the energy bill fails to move forward, the provision on bank-qualified bonds could be resurrected elsewhere, lobbyists said. They said the Senate Finance Committee could possibly include that proposal in an urban aid package the panel is expected to draft next week.

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