Cleanup bonds may be included by Rostenkowski in Superfund bill.

WASHINGTON -- Rep. Dan Rostenkowski plans to offer an amendment to pending Superfund legislation that would permit private firms to use tax-exempt bonds to clean up contaminated industrial sites for redevelopment, an aide to the congressman said Friday.

The Illinois Democrat expects to propose the amendment when the House Ways and Means Committee meets to draft its portion of the bill, which would reauthorize the so-called Superfund law. That statute sets requirements for cleaning up hazardous waste sites.

The committee had planned to meet last week but became stalled over a dispute with another panel that has jurisdiction over the Superfund. A Ways and Means spokeswoman said she was not sure when the drafting session would be rescheduled.

Rostenkowski's proposal would set up a pilot program in more than a dozen cities and several rural areas, where tax incentives would be offered to spur redevelopment of contaminated sites, the congressman's aide said.

One incentive, according to the aide, would be a new category of private-activity bond, called an environmental remediation bond, that could be issued in the designated areas to help private firms purchase and clean up the sites. The bonds would be subject to the private-activity volume cap.

In addition to the bond provision, the proposal would also offer a tax credit to businesses willing to clean up polluted sites, as long as the firms were not responsible for the contamination. The companies would be eligible for a credit equal to 25% of the total cost of cleaning up the site,

Rostenkowski's proposal is a narrower version of a measure introduced last year by Rep. Mel Reynolds. D-Ill. Rostenkowski's aide said the plan was scaled back in several ways so that it would cost the federal government less money. For example, Reynolds' proposal would have placed a national cap on the tax credit of $75 million, while under Rostenkowski's measure the cap would be $30 million.

Rostenkowski may also revise his proposal to limit the amount of environmental bonds that can be issued, the aide said.

Rostenkowski had been the chairman of the Ways and Means panel until June, when he was forced to step aside after being charged in a 17-count indictment related to the House post office scandal. Rep. Sam Gibbons, D-Fla., is now actin, chairman, but under House rules Rostenkowski is permitted to reclaim his chairmanship when and if he is cleared of the charges. He remains a member of the panel.

The overall Superfund reauthorization bill has already been approved by the House Public Works and Transportation Committee, but was sent to the Ways and Means panel so that tax lawmakers could determine what proposals to add to finance the bill's cleanup provisions.

In its meeting scheduled for last week, Ways and Means had been expected to consider a proposal by the Clinton Administration to levy a retroactive tax on commercial liability insurers. But House Energy and Commerce Committee chairman John Dingell, D-Mich., reportedly told Ways and Means he objected to the retroactive nature of the tax. prompting postponement of the meeting.

Dingell, whose committee handles insurance matters, reportedly said he would try to remove the insurance tax provision if Ways and Means approved it in its present form.

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