Illinois corn farmers had an opportunity to thank Senator Mark Kirk for his votes in support of a domestic ethanol industry during Kirk’s Ag Advisory Roundtable on June 17. The meeting was an opportunity for agricultural leaders in the state to discuss issues with Senator Kirk.
Because last week was a big week for ethanol policy, both the Coburn Amendment and the Feinstein Amendment were hot topics. While both amendments sought to end the Volumetric Ethanol Excise Tax Credit (VEETC) immediately, only the Feinstein Amendment passed. Senators Kirk and Durbin voted “no” on both amendments, showing strong support for ethanol and agriculture among Illinois leadership.
Despite the fact that the Feinstein Amendment passed, the VEETC will not actually end immediately. The House of Representatives and the President would also have to agree to immediately end the VEETC before action would be taken. However, the symbolic vote in the Senate now makes it harder for the Illinois Corn Growers Association and National Corn Growers Association to move forward with the policy they approved in March: to immediately transition VEETC into a variable rate tax credit that would provide a needed safety net to the ethanol industry.
Legislation introduced by Senator John Thune of South Dakota, The Ethanol Reform and Deficit Reduction Act or S. 1185, does just this. The legislation immediately transitions VEETC to a variable rate safety net tied to the price of oil, enhances the tax credit for E-85/blender pump infrastructure, and leaves $1 billion for deficit reduction.
Senator’s Durbin and Kirk are co-sponsors of this bill.
Senator Kirk commented during the Ag Advisory Roundtable that a variable rate tax credit tied to oil prices would provide an important safety net to the ethanol industry to ensure that the agriculture sector and rural America stays strong in these challenging economic times. The ethanol industry is facing very low margins, their market is saturated due to the limits imposed by E-10, and to keep producing they have to export their product while the U.S. imports more oil.
Please reach out to Senator Kirk and Senator Durbin and thank them for their support of the domestic ethanol industry last week.
You might also consider calling your Congressman and encouraging their support of the ethanol industry by introducing legislation similar to Senator Thune’s that establishes a variable rate safety net for ethanol in the House.