Dreier says auto bailout bill to die

I just spoke with Congressman David Dreier and he tells me that Senate Republicans expect they will be able to kill the $14 billion auto bailout plan passed by the House. Republicans have been pushing for more concessions from the industry's unions (meaning more job or wage cuts), and believe that going through bankruptcy court would allow for the kinds of changes they are looking for, without costing taxpayer money. Read more here.

Locally, the legislation has a lot of significance for the county MTA- House legislators slipped provisions into the bill that will help guarantee deals that MTA (along with many other transit agencies) made with multiple corporations earlier this decade, where MTA sold of its buses and trains and agree to lease them back over the years. Those deals gave MTA more money up-front, while giving corporate institutions long-term tax breaks on depreciation of the equipment.

The deals were insured by failing-insurer AIG. Right now, MTA is at the risk of having to pay back $165 million to creditors, unless the federal government agrees to assume the risk of the deals (for the back story on this, read here)

Those provisions may add to the difficulty in getting the bill passed. Sen. Max Baucus, is opposing the measure as long as the transit provisions are there (quite possibly, because Montana does not have any public transportation). More on Baucus' issue with the provisions here.

With Republicans opposing the Senate bailout, the Democrats will need every vote they can get, so I wouldn't be surprised to see the transit provisions dropped. Or for the entire bill to fail with or without the transit provisions, as Dreier predicts.