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IDFA Joins Broad-Based Call for End to Ethanol Tax Credit

Mar 02, 2011

IDFA has joined with 89 other business associations, taxpayer advocates, hunger organizations, dairy producer organizations and environmental groups to urge Congress to let the Volumetric Ethanol Excise Tax Credit (VEETC) expire. In a letter sent this week to Congressional leadership, the groups also asked legislators to resist calls for spending on infrastructure for conventional biofuels.

The coalition's letter opposing the tax subsidy for ethanol production came on the heels of successful efforts by ethanol opponents to add amendments to a continuing resolution that would provide funding for the federal government until the next fiscal year begins in September. The Flake amendment, sponsored by Representatives Jeff Flake (R-AZ), will deny any funding for ethanol blender pumps or storage facilities because the ethanol industry is already benefiting from an extension of the VEETC until the end of this year.

IDFA joined with several other associations in supporting the amendment, which passed by a vote of 261 to 168. The letter is available here.

Another amendment, offered by Representative John Sullivan (R-OK), would deny funding for the Environmental Protection Agency to implement its recent decision to allow a 50-percent increase in the amount of ethanol permitted in gasoline. The Sullivan amendment passed by a vote of 285 to 136. IDFA has joined with other associations in opposing the E-15 proposal.

"Dairy producers have been struggling with high feed costs," said Jerry Slominski, IDFA senior vice president of legislative affairs and economic policy. "Instead of government mandates that drive costs higher, we should be looking at changing some of our existing government programs that are actually helping to create the problem."

The House-passed continuing resolution has been sent to the Senate where it faces an uncertain future. The Senate, where there is more support for ethanol subsidies, is likely to reject the House bill and to counter with fewer and probably different spending cuts over the next few weeks. The fate of the Flake amendment will not be known until the bill is sent to the president.

For more information, contact Slominski at or (202) 220-3512.

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