Rethinking PERC and NORA

September 29, 2010
01:59 PM
“Thank you all for coming today to discuss the Propane Education and Research Council, known as ‘PERC,’ and the National Oilheat Research Alliance, known as ‘NORA.’  These check-off programs for propane and oilheat have been in existence for more than a decade.  NORA’s authorizing legislation has now lapsed, making it a good time to re-evaluate the programs.
“Last April, I asked the Government Accountability Office to look into the management and expenditures of each of these organizations.  I had concerns that the publicly available budgets and meeting minutes for each of the programs suggested that consumer education was consuming a disproportionate share of program resources.  The other two statutory functions of each program, safety and training, and research and development, appeared to receive comparatively little funding. 
“The resulting GAO report suggests that the original concern that consumer education had become the dominant objective of the programs was well-founded; 51 percent of PERC expenditures and 65 percent of NORA expenditures are related to consumer education.  Meanwhile, research and development consumed about the same amount of the budget as administrative expenses in each of these programs – 8 percent for PERC, and 6 percent for NORA.  It does seem a stretch to call either of these a ‘research council’ or alliance at this point.
“A more troubling concern emerged out of the GAO report.  It seems that the programs have taken liberties in defining ‘consumer education,’ which in their view includes activities that most of us would call lobbying.  While there are restrictions against ‘influencing legislation or elections’ in the statutes that set up each of the programs, apparently this has not been interpreted as a strict ban on all lobbying activities.
“GAO raised several questions about Congressional intent behind that statutory language, and I think I can safely say that many of us who were in office at the time intended PERC and NORA be research organizations primarily and not lobbying organizations. 
“I also note that GAO highlighted that one of PERC’s strategic objectives related to consumer education is to increase propane use.  It strikes me that we are essentially allowing a fossil fuel industry to tax itself or its consumers in order to lobby and increase its market share.  I’m not sure how many of my colleagues today think that is a policy we should put into law.
“I understand that both PERC and NORA undertake many activities that are well within the parameters of what Congress intended in establishing these programs.  However, it is not clear to me that the benefits outweigh the costs at this point.
“I think it is important that we have a public conversation about the future of PERC and NORA.  I thank our three witnesses for being with us today to give us their views on these important topics.”
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