NEWS FOCUS
Congressional Outlook™ Janice R. Long and David J. Hanson, C&EN Washington
The second session of the 100th Congress begins work on Jan. 25. Legislators will be facing a number of important issues—trade legislation, rewrite of a number of environmental laws, and reauthorization of federal education aid programs, to name just a few— that need to be resolved in a short amount of time. The target date for the sine die adjournment of the 100th Congress is Oct. 5, and whereas Congress missed its adjournment target for the first session by months, not days, 1988 is an election year and members will want to be out of Washington and back home campaigning full-time as soon as possible. That's not to say that they won't be taking a number of long weekends and "district work periods" between now and Oct. 5 for campaign activities. All of these factors will limit the time Congress has to accomplish its legislative agenda. The federal budget will be high on that agenda. The federal purse isn't only empty; it's drowning in red ink. During the first session, Congress once again set for itself a schedule of increasing mandatory deficit reductions to be achieved until a balanced budget is reached in 1993. There didn't seem to be much hope that even the fiscal 1988 budget deficit target of $144 billion would be met until the stock market crash forced Congress and the Administration to the negotiating table. The agreement that they reached called for revenue increases of $11 billion and budget cuts of $12 billion to meet the deficit reduction target. Meeting the 1989 budget deficit target of $136 billion won't be much easier. And balancing the budget by 1993 is going to mean major headaches for whichever party holds the White House after the 1988 elections are over. Herewith is C&EN's annual preview of some of the issues affecting the chemical community to be addressed in the coming session of Congress. Biotechnology. The Senate Committee on Agriculture, Nutrition & Forestry, jointly with the Judiciary Subcommittee on Technology & the Law, is undertaking what Agriculture Committee chairman Patrick J. Leahy (D.-Vt.) promises will be an "in-depth explora-
tion of eight key areas that must be addressed by a national biotechnology policy." The two panels already have held a hearing on the U.S. competitive position in biotechnology. Next up is a hearing to define the regulatory and patent issues that must be addressed in the biotechnology area. Other issues of concern to the two panels include agricultural
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News Focus applications of biotechnology, support for biotechnology firms that pioneer new discoveries, support for a premier research program, and reworking the biotechnology regulatory structure. The Labor & Human Resources Committee will be looking at legislation, S. 1966, introduced by its chairman, Sen. Edward M. Kennedy (D.-Mass.), along with several other Senators that would establish a National Biotechnology Policy Board, a National Center for Biotechnology Information, and an advisory panel on mapping the human genome. In the House, the Agriculture Subcommittee on Department Operations, Research & Foreign Operations, chaired by Rep. George E. Brown Jr. (D.-Calif.), is undertaking an extensive series of hearings on agricultural research, which will focus on, among other things, a major research initiative on employing biotechnology to find nontraditional fiber and nonfood uses for crops. Business. In the next few months the full Senate is expected to take up a bill, S. 1323, reported by the Committee on Banking, Housing & Urban Affairs, requiring earlier announcement by a corporate "raider" of acquisition of 5% of a company's stock, specifying that stock purchases over a 25% threshhold level be made through a tender offer to all stockholders, and limiting a company's ability to buy back its stock from a raider at a premium price not offered to other shareholders. Last summer, the Senate did approve legislation, S. 1068, that tightens premerger notification requirements and prohibits individuals from serving on the boards of competing corporations. The House Energy & Commerce Committee is expected to begin work on its own version of antitakeover legislation early this year. Wrapped into the trade bill, H.R. 3, is a provision
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that would require companies with 100 employees or more to give employees 60 days' advance notice of plant closings or mass layoffs. Also in the offing is legislation that would raise the minimum wage to $4.65 an hour from $3.35 an hour over three years. Education. Another area that has a number of programs wrapped up in the trade bill is education. These programs include a six-year reauthorization of the Education for Economic Security Act, which provides federal grants to state and local education agencies to fund math and science teacher training and recruitment programs and the development of elementary and secondary school science and math curricula. Also in H.R. 3 is a $100 million "Star Schools" program to set up telecommunications networks for teaching science, math, and foreign languages to elementary and secondary school students. House and Senate conferees have reached agreement on the education provisions of the trade bill. These provisions were also included in the Senate version of H.R. 5, a $7.^ billion reauthorization of federal education grant njjograms, which passed Dec. 1. The House approved H»jv,ersion of the bill on April 30, 1987. Therefore, eve:tf!tf the trade bill doesn't fly,
the education programs will still be approved by Congress. Energy. Several energy-related bills will be coming back before this Congress in its second session. However, one particularly thorny issue was resolved by fiat in the fiscal 1988 budget package—designation of Nevada as the site for a high-level radioactive waste depository. Political arguments had been intense over the issue since Congress passed a bill in 1982 that involved a long, drawn-out selection procedure for the site. There is some doubt that Nevada's designation will stick, however, as the haste with which the measure was a p p r o v e d irked some m e m b e r s of Congress. A renewed nuclear insurance law didn't quite make it in the previous session. Although a House version passed in July, the Senate got bogged down and a bill didn't reach the floor. The present limit on liability payments for nuclear accidents is $700 million, but the House and Senate versions will raise that to $7 billion for damages in case of a nuclear power plant accident. Another issue that seemed to have wide support last session but may not reach final enactment is repeal of the windfall profit tax on petroleum. The tax was implemented at a time w h e n it was believed that domestic oil companies were making huge profits because foreign oil prices were skyrocketing. Attempts to repeal the tax have been sought more recently because oil prices have fallen so low that no tax is being collected even though the paperwork has to be done. Currently, legislation to repeal the tax is in the omnibus trade bill snailing its way through Congress. Industry analysts think repeal of the tax would provide incentives to small petroleum producers to drill more wells, something they haven't done much of lately. But the issue has become so politicized that attempts to repeal the tax may not be successful.
Likely to pass sometime in this new session is a bill to promote the use of alternative fuels in automobiles. The House passed its version of this legislation, H.R. 3399, last month, and the Senate bill, S. 1518, was reported out of the Energy & Natural Resources Committee just before the first session ended. This type of legislation has been tried before but never passed. Basically, the bills are aimed at making alternative fuels—that is, methanol, ethanol, and natural gas— attractive to major car manufacturers by providing financial incentives to build cars that can use these fuels. The incentives focus on ways of recalculating the corporate average fuel economy ratings of manufacturers by factoring in the use of alternative fuels, which would allow the production of cars with lower mileage ratings. The Senate reports that there is sufficient natural gas to meet any near-term demands for it as an automobile fuel, and it seems to assume there would be enough methanol and ethanol production if the demand were there. Another bill that will be considered in this session looks at the safety of operations at the Department of Energy's nuclear production facilities. This bill, S. 1085, would set up an Independent Nuclear Safety Board to provide oversight and recommend safety changes in the department's nuclear plants. There is some disagreement among Senate committees as to the board's powers, however, and it is not likely this legislation will move very soon. Environment. It sometimes seems that each session of each Congress faces a list of "must d o " environmental issues that never get done. This year it looked like the Clean Air Act would once again take its place on the list. But then in the last days of the first session the House set itself a deadline, which the Senate later agreed to, for consideration of the clean air reauthorization bill. The deadline is contained in H.J. Res. 395, the massive fiscal 1988 funding bill. The provision in question delays for eight months, until August, economic sanctions against cities that are not meeting air quality standards for ozone and carbon monoxide. The House rejected, 257 to 165, an amendment that would have allowed a 21-month delay in imposing the sanctions. If that amendment had been successful, Congress would have been under no pressure to reauthorize the Clean Air Act until sometime in the 101st Congress. As it now stands, the Senate Committee on Environment & Public Works has reported out a far-reaching package of amendments, S. 1894, to the Clean Air Act that contains provisions on toxic air pollutants, acid rain, clean coal technologies, accidental releases of extremely hazardous substances, and technology-based standards to control routine emissions from major sources of air pollutants. In the House, the Energy & Commerce Subcommittee on Health & the Environment has essentially completed its hearings on clean air issues and has been holding closed meetings to discuss what should be in the legislation. Another long-time item on the environmental agenda is reauthorization of the Federal Insecticide, Fungicide & Rodenticide Act (FIFRA). Both the Senate January 11, 1988 C&EN
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News Focus and House Agriculture committees have completed hearings on the issue, and the Senate committee is expected to begin marking up a bill early this year. Pesticide bills dropped in the hopper so far, including S. 1419, S. 1516, and H.R. 2463, contain provisions supported in the 99th Congress by an unusual coalition of farm groups, environmentalists, and the agricultural chemical industry. These provisions set a timetable for the reregistration of some 600 active pesticide ingredients, impose fees to pay for the reregistration process, and address the problem of pesticide contamination of groundwater. However, a draft package of amendments to S. 1516 is now being circulated that would repeal provisions in the current law that require a generic pesticide manufacturer to compensate the original developer of an active pesticide ingredient for use of its health and safety data to register a knock-off product once its patent has expired. Such a repeal is strongly opposed by the agricultural chemical industry. And environmental groups are concerned about what the bills don't contain, such as provisions allowing states to set stricter tolerances for pesticide residues on food than the federal government does. Putting the coalition back together won't be easy, but without it, the chances of passing a FIFRA bill are dim. New on the environmental agenda this year is reauthorization of the Resource Conservation & Recovery Act, which governs waste disposal. The emphasis this time around is expected to be on problems associated with municipal waste disposal, the feeling being that hazardous waste disposal was pretty well taken care of in the previous reauthorization bill, which, among other things, banned land disposal of liquid hazardous waste. However, there is one exception to the emphasis on municipal waste— hazardous waste disposal at federal facilities. During the final days of the
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first session a group of Representatives, including 10 members of the Energy & Commerce Committee, introduced a package of bills that seeks to make federal facilities, particularly Department of Energy nuclear facilities, meet the same waste disposal requirements as everyone else. And the House Armed Services Committee has set up an Environmental Restoration Panel that is looking into the Department of Defense's efforts to clean up the hundreds of hazardous waste sites that it owns. Other issues that will be examined by various Congressional committees and subcommittees include indoor air pollution, groundwater protection, climate change, and the Antarctic ozone hole. Health. As public awareness of the dangers and complexities of acquired immune deficiency syndrome (AIDS) has grown, so has Congressional activity. The issue was a major concern in the past year, and will continue to occupy much of Congress' time in 1988. Most of the argument surrounds the moral and ethical issues of AIDS education and mandatory testing of various groups for exposure to the virus, but increasing support for research has also been a priority. Rep. Henry A. Waxman (D.-Calif.) has been in the forefront of the debate with a bill, H.R. 3071, that would provide funds for voluntary AIDS testing, seek to e n s u r e confidentiality of t h e tests, a n d extend antidiscrimination protections to those infected with the virus. After getting stalled in early attempts to move this bill, Waxman plans to pursue it early this year. AIDS research funding got a big boost for 1988. In the budget agreement signed last month, Congress more than doubled funding for AIDS programs (C&EN, Jan. 4, page 6). Programs will be set up at the Centers for Disease Control; the Alcohol, Drug Abuse & Mental Health Administration; and the Food & Drug Administration. At the National Institutes of Health, most of the research budget increase—$448 million—will be directed solely to AIDS research, the remaining programs receiving less than a 1% rise. Approval can be expected in 1988 for a law that will require employers to notify all workers, past and present, of any exposure to chemicals that are thought to pose a substantial risk to health. The House passed such a measure in October, H.R. 162, and a Senate version, S. 79, has been approved by the Labor & Human Resources Committee. The measure, after some early changes, has support from industrial groups and is fairly noncontroversial. A risk assessment board would be set up to review medical evidence and identify groups of workers at risk. Notified workers would be entitled to employer-paid testing. Another piece of unfinished business, which could have a substantial impact on the pharmaceutical industry, is a provision in the catastrophic health insurance legislation, passed by both houses, that might force medicare recipients to consider generic drugs over brand name products. The bills, which are not expected to go to conference committee until some time next month, would for the first time offer medicare payments for prescriptions, but in an effort
to contain costs, would base reimbursements on the generic drug price. They would allow pharmacists ^ to use generic versions of a drug unless the physician specifically stated the brand name drug is medically necessary. The pharmaceutical industry, headed by the Pharmaceutical Manufacturers Association, fears that once the federal government becomes involved, government price controls of drugs might follow. Drug makers believe attempts to regulate prices would lead to fewer new drugs and higher costs. One measure helping vaccine manufacturers was in the budget reconciliation package enacted at the end of the year. Vaccine compensation legislation passed in 1986 had not provided any mechanism for paying compensation to persons injured as the result of adverse reactions to required childhood vaccines. The budget bill includes a provision that establishes an excise tax to be paid by the vaccine users that would be used for a trust fund from which families could collect. Intellectual property. The House Judiciary Committee reported out patent legislation, H.R. 1391, on April 22, 1987. The Senate Judiciary Committee also reported out a patent bill, S. 1200, on June 23. Both bills were subsequently incorporated into the trade bill. The intellectual property provisions of the trade bill, H.R. 3, provide U.S. patent owners with new rights to sue for damages and seek an injunction in federal district court when someone, without authorization, imports into the U.S. or uses or sells in the U.S. a product made by their patented process. They also provide that a patent owner's licensing practices cannot be found to constitute patent misuse unless such practices violate antitrust laws. Because both bills
were reported separately from the trade bill, the committees could decide to bring each of them up for a floor vote. Product liability. This is an issue that has been plaguing businesses for years and has perennially failed to get much action in Congress. Bills introduced in previous years have failed to even reach the House or Senate floors. In this Congress, however, renewed attempts to pass liability legislation are having some success in the House. H.R. 1115 has struggled to narrow approval by the House Subcommittee on Commerce, Consumer Protection & Competitiveness. This bill, which has some qualified industry support, would preempt the various state product liability laws that manufacturers say create a threat to interstate commerce. Other provisions the industry supports include a faultbased standard in warning cases, restrictions on punitive damage awards, and elimination of joint and several liability for noneconomic damages. However, the Chemical Manufacturers Association is arguing against a provision in the bill that would impose strict liability on all chemical uses and chemical products labeled "ultra-hazardous." In addition, consumer groups have not been pleased with the bill. Therefore, it is expected some compromises might have to be made before the Energy & Commerce Committee approves it. Taxes. An election year is not a time when Congress puts much emphasis on raising taxes, particularly personal taxes. On the other hand, it's not likely to reduce taxes this year either, given the budget crunch. However, if it becomes necessary to find new revenues to meet the Gramm-Rudman mandatory deficit target of $136 billion for fiscal 1989, corporations may find their taxes increasing and users may find themselves paying for federal services. Trade. The trade bill actually does contain some provisions that deal directly with trade issues. It renews the "fast track" Congressional approval procedure for trade agreements entered into by the President with foreign countries; gives the U.S. Trade Representative wide power to negotiate tariff cuts and agreements for reducing nontariff trade barriers during the current round of multinational trade talks; establishes a special procedure to open foreign markets with a consistent pattern of trade barriers to U.S. products; and eases export controls on shipments of high-technology goods to U.S. allies. However, there are many, many differences between the House and Senate versions of the trade bill, which is printed on more than 1000 pages. The conference committee on the bill, which includes 44 Senators and 155 House members divided into 17 working groups, so far hasn't made much progress on resolving those differences. Congressional leaders hope to have an agreement ready for final approval by late February or early March. But even if that happens, there is a good chance that President Reagan will veto the measure unless the conferees remove a number of provisions that are strongly opposed by the Administration. D January 11. 1988 C&EN
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