Posted May 21, 2010
Iowa Secretary of Agriculture Bill Northey and seven other state agriculture officials have formally asked congressional leaders to act quickly to extend the Volumetric Ethanol Excise Tax Credit (VEETC) and other ethanol incentives, which expire at the end of the year.
Northey and state ag colleagues from Ohio, Illinois, Wisconsin, Missouri, Nebraska, North Dakota and South Dakota made the request in a letter today to Senate Majority Leader Harry Reid, Senate Republican Leader Mitch McConnell, House Speaker Nancy Pelosi and House Republican Leader John Boehner.
Legislation has been introduced in both the U.S. Senate and the House of Representatives to extend the current ethanol tax policies to 2015. The ag leaders “strongly support” extending the VEETC, the ethanol tariff and the cellulosic tax credit.
“As agricultural leaders in our states, we have witnessed firsthand the benefits of domestic ethanol production,” the letter stated. “We believe that extending the tax incentives for this critical value-added industry makes good public policy and common sense.”
In the letter, the state ag officials site a recent study by the University of Missouri’s Community Policy Analysis Center that found failure to renew the tariff would result in 39,506 job losses in the first year after the tariff lapses, 115,624 job losses in the second year and 161,384 in the third year. The corresponding and dramatic decline in economic activity was calculated at $9.2 billion the first year, $26.4 billion the second year, and $36.7 billion the third year – and remaining in the double digits during the 10-year projection.
“The failure to extend the biodiesel tax credit and the damage that has been done to that industry clearly highlight the need to act in a timely manner to make sure these critical policies are in place by the end of the year,” Northey said.
“The good news is that we are just scratching the surface of America’s ethanol potential,” according to the letter,” but, all present and future benefits of ethanol are in jeopardy if these vital policies are not maintained.”
In addition to Northey, state ag officials signing the letter included Jon Farris, South Dakota; Robert J. Boggs, Ohio; Doug Goehring, North Dakota; Tom Jennings, Illinois; Dr. Jon Hagler, Missouri; Rod Nilsestuen, Wisoconsin; and Greg Ibach, Nebraska.
-30-