Military May Have to Tell Lawmakers Before Filling the Tank

Posted December 12, 2014 at 1:56pm

The Senate is expected to pass the fiscal 2015 defense authorization bill (HR 3979) today, legislation that would require the military to notify congressional committees about certain biofuel expenditures.

Speed Bumps for Biofuels. The legislation would tighten the military’s use of advanced biofuels. It also addresses western ranchers’ concerns over grazing permits and provides money for communities where the federal government is a big owner of land exempted from local property taxes.

The legislation would allow the Defense Department to continue buying biofuels in bulk but raises the threshold for qualifying purchases. The department has to consider “the fully burdened cost” of the fuels and whether their price is competitive with conventional oil-based fuels. The bill defines the term as the commodity price of the fuel plus the costs of personnel and assets required to move and, if necessary, protect the fuel from the commercial supplier to the point of use.

DOD is required to give House and Senate Armed Services committees a 30-day notice if it plans to make a large purchase of alternative fuels that cost 10 percent more than conventional fuels. The department also is required to notify the committees no later than 30 days before it plans to enter a contract to plan, design, refurbish or build a biorefinery.

The restrictions reflect the tug of war between the Obama administration, which views military biofuel purchases as a way to accelerate demand for fuels made from non-food crops, and skeptics in Congress, many of them from oil-producing areas.

Agriculture Secretary Tom Vilsack has been bullish on military use as a way to expand the biofuel industry and support rural economies. Critics of the idea say it is a costly and unnecessary push since traditional petroleum-based fuel is readily available.

Grazing Permits. Ranchers in the West would have gotten longer terms for permits to graze on federal public lands in earlier legislative language. Permits are currently valid for 10 years and they won’t now be extended to 20 years. The legislation also would automatically renew permits issued by the USDA’s Forest Service and the Interior Department’s Bureau of Land Management before environmental impact assessments required under the National Environmental Policy Act are finished. The provision is based on House-passed legislation (HR 2954).

PILT Allocation. The bill also would allocate $70 million for the Payment in Lieu of Taxes (PILT) program for payments to be made to eligible areas spread over two fiscal years. In fiscal 2015, $33 million would go out in payments while the remaining $37 million could be spent in fiscal 2016, which begins Oct. 1, 2015. The fiscal 2015 spending package up for final passage in the Senate would provide $372 million for PILT, putting the total for the current fiscal year at $405 million.

PILT is an orphan program with a roller-coaster history since its start in 1976. A George W. Bush administration economic stimulus law (PL 110-343) provided some stability in fiscal 2008 through 2012 by making the funding mandatory. In fiscal 2013, Congress extended the mandatory status. But supporters of the program had to scramble for fiscal 2014 mandatory funding, which they found in the farm bill (PL 113-79).