Disaster funding became a key point in the budget battle after Republicans released a plan late Wednesday stripping $1.5 billion from a program advancing electric and hybrid cars in exchange for providing $1 billion in emergency aid to states reeling from natural catastrophes.
The plan angered Democrats, who are defending clean energy initiatives tainted by the collapse of a government-sponsored solar manufacturer, Solyndra, last month. Some criticized the Republican plan for continuing to take money from emission-reducing programs during a year of heightened natural catastrophes.
"The record floods, fires, droughts, and storms that have ravaged our nation are exactly what climate scientists have been predicting," Rep. Henry Waxman (D-Calif.) said in a statement. "If we want to avoid future weather disasters, we need to increase -- not cut -- investments in clean vehicles and other clean energy technologies."
The measure builds on the challenges Congress faces in appropriating funds, faced with an influential conservative wing of the Republican Party willing to stand tough on spending rarely contested. Disaster aid is routinely passed without controversy, in part because catastrophes are politically undiscriminating.
The federal government, for example, has issued 86 disaster declarations for Texas, a Republican state, since 1953. That's more than any other. California, a Democratic state, received nearly as many, at 78.
Still, there are knotty questions about the United States' handling of disaster financing. It's nearly always approved by Congress in the wake of a catastrophe, meaning that revenue wasn't identified in the budgeting process to pay for it. So it increases annual deficits.
The numbers can be huge. In 2005, when Hurricanes Katrina, Wilma and Rita struck, $43 billion was added to the debt through the Federal Emergency Management Agency's disaster relief fund. It was $6 billion in 2006, $4.1 billion in 2007, $11.8 billion in 2008 and $5.1 billion in 2010.
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And the number of big disasters is growing. The rise stems from increased development in hazard-prone areas, like coastlines. But climate-related impacts are also pushing the losses up, says Adam Smith, a physical scientist with the National Oceanic and Atmospheric Administration who tracks billion-dollar disasters in the United States.
"Heat waves and droughts are natural disasters that have more of a direct connection to climate," Smith said in an email. "Individual weather events (e.g., tornado outbreaks, hurricanes) are not as clearly attributed to climate change at this time, but it may still be factoring into the increasing frequency and severity for many extremes we've seen so far this year."
Congress did something about its disaster debt this summer. Within the Budget Control Act, which raised the debt limit, is a provision to pre-fund catastrophe aid. It's based on a simple calculation: Take the average cost of disasters in the past 10 years, minus the biggest and smallest events, and appropriate it before the disasters strike. For 2012, that amounts to $11.3 billion.
There are some benefits to the plan. It's easier to balance a budget if you know how much will be spent. It also allows Congress to exceed its discretionary cap of $1.043 trillion by as much as the calculated cost of disaster funding. And it can be done with a simple majority vote. In the past, the Senate needed 60 supporters.
The provision reorients the passage of disaster funding by "180 degrees," according to one Democratic Senate appropriations aide. "It in fact makes it easier for the Congress to approve money for disaster relief programs."
But that's only true if both parties abide by the new rules. The House Republican plan indicates that conservative members might be having second thoughts. Spending offsets for disaster funding aren't needed under the Budget Control Act because it provides a "cap adjustment" -- or the ability to exceed the top limit of spending.
The Republican plan to cut $1.5 billion from the Department of Energy's Advanced Technology Vehicles Manufacturing program, to provide $1 billion in disaster funding, was included in a short-term measure to fund the government through Nov. 18.
The energy program has provided $9.1 billion in loans to six car companies so they can retool U.S. plants to make cleaner cars.
Cutting jobs, or money 'lying around'?
Ford Motor Co. is the biggest recipient, using $5.9 billion in DOE loans to upgrade factories in Illinois, Kentucky, Michigan, Missouri and Ohio, according to DOE. The program will help raise the fuel efficiency of the company's cars, avoiding about 2 million tons of carbon dioxide emissions and the use of 227 million gallons of gasoline, the agency says.
The loans to Ford will also create or save 33,000 jobs, says DOE.
"If you target this particular fund, you are targeting a fund which has demonstrably grown jobs," Rep. Steny Hoyer (D-Md.) told Rep. Eric Cantor, the Republican majority leader from Virginia, on the House floor yesterday. "It appears we may be cutting off our nose to spite our face here."
But Cantor doubts DOE's assertions, saying many of those jobs already existed and noting that the loan program still has about $4 billion in unspent money.
"This money has been lying around since Sept. 30, 2008," Cantor said. "That is three years."
Hoyer responded that the program has $3.9 billion in pending loan requests, which would create between 50,000 and 60,000 additional jobs.
House Republicans are only requiring offsets for a portion of the disaster funding. The bill also provides $2.65 billion for disaster relief in 2012, without spending reductions elsewhere.
The Senate rejected the Republican strategy yesterday evening by passing a measure to inject $6.9 billion into FEMA's sputtering disaster fund. The chamber is not asking for any cuts in return.
Sen. Mary Landrieu (D-La.), who led the Senate disaster effort, cautioned Republicans before the vote that relief efforts across the country would be slowed down if they opposed the measure. It passed 62-37, with the support of nine Republicans.
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