W By Jonathan Weisman

ASHINGTON – A week after his departure was all but announced for him, Sen. Pete Domenici, R-N.M., decided Tuesday night to make it official: He will be turning over control of the Senate Budget Committee to Senate Republican Whip Don Nickles, R-Okla., after 22 years as the panel’s top Republican.

The decision, to be announced Wednesday, would not seem like news to anyone who heard soon-to-be Senate Majority Leader Trent Lott, R-Miss., tell reporters last Wednesday that he expected Domenici to take over the chairmanship of the Senate Energy and Natural Resources Committee.

That announcement proved revealing, although premature. Republican congressional sources say the GOP leadership has been trying to nudge aside Domenici, a budget hawk, to grease the path for more tax cuts and domestic spending cuts. But after Lott’s statement, fellow budget hawks and congressional spending chiefs – including former Congressional Budget Office director Robert Reischauer, incoming Senate Appropriations Committee chairman Ted Stevens, R-Alaska, and Robert Bixby, the head of the Concord Coalition, a budget watchdog group – implored Domenici to stay at the helm of the committee.

Reischauer and Bixby worry that Nickles, a conservative, will push large tax cuts in the face of burgeoning budget deficits. Stevens fears that Nickles and his House counterpart, Rep. Jim Nussle, R-Iowa, will draft budget blueprints that squeeze nondefense appropriations to make room for tax cuts and defense budget increases, then demand that the congressional spending committees produce specific cuts in popular domestic programs.

Domenici had his own concerns, according to Senate sources, including the fate of his longtime staff.

G. William Hoagland, the committee’s veteran GOP staff director and considered one of the most powerful aides in the Senate, will be an unlikely casualty of last week’s Republican electoral victories. He is well respected by Democrats and Republicans, but some conservatives view him as insufficiently committed to tax cuts, and he has angered the White House budget office with deficit forecasts that are decidedly more pessimistic than President Bush’s.

“If Nickles were to come in and keep Hoagland on board, it would be like Domenici never left,” one White House official said.

Hoagland said he is certain Nickles will replace him and bring in his own people, including Eric Ueland, his chief of staff, and Hazen Marshall, his budget expert. Both men would bring a more conservative edge to the committee.

In 1995, Marshall was Nickles’ contact point when the senator tried unsuccessfully to secure deep cuts to the earned income credit, a tax refund aimed at the working poor.

The following year, from his perch as staff director of the Senate Republican Policy Committee, Ueland launched a new publication – “The Clinton Crunch.” Its inaugural issue, published on the cusp of a record-breaking boom, hailed “The Coming Clinton Recession.”

Domenici finally informed Lott Tuesday evening that he will move to the energy committee, where he can safeguard the Department of Energy’s two nuclear weapons laboratories in his home state.