Senator says attempt to remove oxygenate rule faces difficult future

INCLINE VILLAGE - U.S. Sen. Dianne Feinstein said Saturday that her attempt to eliminate federal rules requiring gasoline oxygenates such as MTBE is foundering before opposition from Corn Belt states, which she said have the backing of both Al Gore and George W. Bush.

Feinstein said those ethanol-producing states, supported by the two major presidential contenders, have made it likely that the bid to eliminate oxygenates will be rejected.

Indeed, she told some 250 people gathered for The Tahoe Forum, the level of the federal oxygenate rule, now at 2 percent, could be increased to 4 percent or more.

''There is this enormous political problem, crafted by the Corn Belt states that exists, stopping any legislation from going ahead at the present time,'' Feinstein told a group of local residents and business, academic and government officials.

Attempts to reach a compromise dissolved after Bush and Gore said they supported the ethanol producers, Feinstein said.

''The negotiations all fell apart,'' she said.

Oxygenates - chemicals that are added to fuel to make it burn more cleanly to cut air pollution - are a touchy subject in California, where most people favor their elimination.

There are two main oxygenates - ethanol and MTBE.

In California, MTBE has been used widely for a decade, but it is being phased out by an executive order of the governor. One of the areas hardest hit by MTBE was less than 100 yards from where Feinstein spoke - Lake Tahoe, where authorities banned two-stroke engines last year to cut MTBE contamination.

Residues of MTBE, a hazardous chemical that smells like turpentine, have been found in 10,000 wells across the state, nearly three dozen municipal water systems and in at least 20 of California's 58 counties.

The federal government requires an oxygenate to be added to fuel at certain times of the year in the nation's smoggiest areas, including California.

California is phasing out MTBE, and major refiners in the state, such as Tosco and Chevron, have produced gasoline without MTBE or any other oxygenate that meets the federal clean air rules.

Feinstein wants the oxygenate rule eliminated completely.

But ethanol, a kind of ''white-lightning'' alcohol made from corn is a significant piece of the farm economy. The midwest states that produce ethanol want the oxygenate rule retained.

''We don't need it here,'' said Feinstein, whose anti-oxygenate legislation has been stalled.

''The farm state senators are expected to propose some guarantee for ethanol or other alternative fuels,'' she said. ''Some prudent substitution of ethanol is fine, but to require its use when it isn't necessary is just plain wrong.''

Feinstein's comments came on the first day of a weeklong swing through Northern and Central California.

Earlier in the day, she met with members of the Quincy Library Group, the coalition of business interests, environmentalists and others who developed a compromise logging scheme for the northern Sierra Nevada. She also planned to attend a fund-raiser and hold a round of meetings in Eureka, Redding and Tulare.

Feinstein, a Democrat, is up for re-election this year, facing Rep. Tom Campbell, a Silicon Valley Republican.

Feinstein enjoys a commanding lead in the polls - a lead that has changed little over the past 10 months.