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Ethanol tax credit vote could be delayed until 2011

Senator Chuck Grassley (R-IA), shared his view of how a
Republican takeover of Congress might affect agriculture Tuesday. He sees
little change in farm policy in the agriculture committees, more support for
trade agreements and more emphasis on existing tax credits for ethanol and
biodiesel than on trading of energy offsets.

Tax credits are expected to come up in a lame duck session
in November and December after the election but before new members of Congress
are seated next year.

But Grassley told reporters Tuesday that Republicans might
take the view that they could wait until January of next year to deal with tax
issues, when they’re in the majority, if they do as well as expected in

That would mean that the 45 cent-a-gallon tax credit for
ethanol would expire this year without being renewed, a fate similar to what
happened at the end of 2009 when the $1 a gallon biodiesel tax credit expired
without being extended. The biodiesel credit still hasn’t been renewed.

Grassley said that he hopes that doesn’t happen. Instead, he
hopes that while Democrats still control Congress in late 2010, that “for the
good of the country,” they’ll bring expiring tax credits to a vote.

More than 20,000 jobs in biodiesel have been lost because of
the expired tax credit and more than 100,000 jobs in ethanol are at risk if the
tax credit expires at the end of this year.

“Uncertainty about tax policy has been detrimental to
getting unemployment down,” Grassley said.

In the area of energy policy, Grassley said that he believes
his party will prefer to put more emphasis on existing tax credits and renewing
those than on the kind of offsets that have been proposed by Democrats in the
Senate and already passed in the House in a climate change bill.

Farm policy won’t change much, he said.

“If Republicans take control of the Congress, particularly
the Senate, I don’t think it would affect agricultural policy a lot,” he said.

Republicans would be much more supportive of approving free
trade agreements with Colombia, Panama and South Korea, he said.

“I think it might give the President a little more backbone
to move ahead,” Grassley added.





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