(UTU National Legislative Office Letterhead not reproduced)

October 3, 2000

To: All Concerned

From: James M. Brunkenhoefer

We have received numerous phone calls as to what will happen next on H.R. 4844. This is a question that no one can answer at this moment. Before we discuss where we are going, I would like to review where we are.

All bills dealing with tax matters must originate in the U.S. House of Representatives. H.R. 4844 is covered by that definition. With everyone's help, we have been very fortunate and we have a clean House-originated bill awaiting Senate action. The most preferential treatment would be that H.R. 4844 would be handled as a stand-alone bill. Because of the lateness of the legislative hour, we would need unanimous consent. It is possible that we will receive such treatment but not likely. This is because we know we are actively opposed by Senator Don Nickles (R-OK), Senator Phil Gramm (R-TX), Senator Pete Domenici (R-NM) and a few other right wing conservative budget hawks. We should be thankful for the overwhelming amount of support that we have. The 80 Senators who signed the Roth-Moynihan letter support us. We have support from all the Democrats. There are just a handful of Republicans that are against us.

Many of the Republicans that have signed on are going to their leader, Senator Lott and requesting movement of the Railroad Retirement issue. Senator Lott has been helpful and has been making efforts to work through this complicated situation. Because we are the last tax title legislation pending in the Senate, there are numerous Senators who would like to make H.R 4844 a Christmas tree of tax items. Last Thursday, September 28, when H.R. 4844 was reported by the Finance Committee, Senator Roth chose to remove from consideration the Community Development Act. The Act would have been this session's tax Christmas tree. Although we prefer that H.R. 4844 be kept clean, we will not object to anything that is agreed to by all of the parties. The interested parties include the House leadership, both Democratic and Republican, the Senate Leadership, both Democratic and Republican, as well as the White House. In other words we don't care what it looks like as long as it becomes law.

Not only is there the Christmas tree problem, as of today, only two of the 13 necessary appropriations bills have been signed into law. The federal government's fiscal year ended on October 1. All of the federal agencies are spending money and continuing to operate under the authority contained in a Continuing Resolution (CR) that was passed on Friday, September 29, 2000, and expires on Friday, October 6. It is doubtful that all will get their act together by that deadline. An additional CR, or several CRs, will be needed to be approved until Congress adjourns, or the government would shut down in an election year. This is possible but very unlikely. These will lead to showdowns between the Republicans in Congress and President Clinton. Each will be trying to make the other blink first. Many Republicans still hate Bill Clinton and want a final victory over him. They look at this concluding legislative session as a way of achieving that victory.

Many Republicans have told us that although they support the passage of H.R. 4844 the White House will have to ask for its passage. The White House wants the Republicans to ask for its passage. That way, the other guy will use up their chip in the final game. So, not only could our bill become the Christmas tree that contains the entire load, our bill could be a part of a yet to be drafted, much less introduced or considered final omnibus bill that would carry everything that Congress has not gotten done. If this is the case, we will be a part of a final action of the final bill of the final day of this Congress. There is the possibility that Congress will try to add on to H.R. 4844 many things that are objected to by the White House and President Clinton. This is so they can blame the President for killing the bill. If they do, we know whom to blame and we probably will still be in the final deal.

We obviously want to keep the pressure on, but until we get a clear signal, we do not want to apply pressure to the wrong place. Misdirected pressure could bring down the entire situation. I am sure that you will hear numerous rumors. Please disregard them and act only on information received from the coalition or your Union. It is my expectation that the endgame we have been preparing for that involves the House and Senate leadership and the White House is what is most likely to occur. We do not know exactly what route will be taken, but we have been preparing for the final destination. Of course, anything this complicated is full of pitfalls, but I am optimistic because of our experience. We are the Energizer Bunny -- we just keep going and going and going. The only reason for this has been because of your successful efforts. Once again, thank you.

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