SENATOR HUTCHISON DISCUSSES HURRICANE IKE RELIEF

I so appreciate working with the chairman of the Finance Committee, as well as Senator Grassley. Both Senator Baucus and Senator Grassley have been very helpful in trying to fashion an addition, actually, to the tax extender bill because, of course, as Senator Cornyn has said, this hurricane hit our State last weekend. We have seen the pictures--all America has seen the pictures--of the streets of Galveston, the former streets of many of our areas, and the residents who still cannot get back into their homes, including 2 million people who still don't have power. So we know the devastation that has hit our area,

but we don't know yet what the total cost is going to be, because we can't even get into Galveston to start making assessments. Certainly Port Arthur, Orange, Beaumont, the lower parts of Harris County--all the way through our area, we are seeing the effects of this storm that are not yet calculable.

The Finance Committee has agreed to add into the bill, that was already on the way, the help that Texas and Louisiana are going to need because of Ike in the tax part of the extender package. The disaster part that will be added in is going to be very helpful to the private sector and the ability to start getting the housing up and going in these areas that have been completely wiped out. I think that later, when Senator Baucus comes to the floor, we will want to talk about it to make sure it is clearly understood exactly what the effects will be on Texas and Louisiana. But our delegations have worked very closely together with Senator Baucus and Senator Grassley to achieve what I think is a good result.

In addition to the disaster part of the bill, there are important parts of the tax extender package that will affect all of our communities. Certainly in Texas, the sales tax extension that is a matter of equity for States that don't have income tax, to be able to have the same deduction for our sales taxes that income tax State taxpayers have for theirs is a very important component of the tax extender package. Then, again, since Senator Baucus has just walked on the floor, I wish to say that I think what has been worked out on the oil and refinery tax issue from the manufacturing standpoint, along with the additional two years of the expansion of refinery tax credit, we are going to be able to continue to build out the refineries that will affect the price of gasoline all over our country, because as we are seeing right now, due to Hurricane Ike, the shutting down of refineries affects the price of gasoline everywhere. If we can add to the capacity of our refineries all over the country--this is not only Texas and Louisiana; this is Michigan and everywhere where there are refineries--if we can add to that capacity, it adds to supply, and it will bring down the price of gasoline. The extension of 2 years is going to be very helpful for refineries to have an incentive to do even more than they have already been committed to do.

Certainly, I think the addition of the manufacturing tax credit, even at the lower level, will also add to the capability as these Gulf of Mexico rigs and refineries are spending millions of dollars, not only on cleaning up the damage and trying to get back up and operating, but they are also helping their employees at a time such as this with the problems they are having with their homes being gone and their living conditions being unable to be sustained.

I thank the Senator from Montana, the chairman of the Finance Committee, for working with us on that. I ask if the Senator is ready to go with a colloquy, or should we wait. I don't know what the status of the tax extender package is at this point, but perhaps he would be able to tell us.

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