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Harkin worries about ethanol tax credit
A bipartisan amendment introduced in early March to
repeal the 45 cent-a-gallon tax credit died in the Senate this week when one of
its sponsors, Senator Tom Coburn (R-OK) said he would not hold up a small
business bill to force a vote.
Coburn, and the bill’s cosponsor, Senator Ben Cardin
(D-MD) may not have had the 60 votes needed to overcome a filibuster. But
Coburn indicated that he might try to seek a suspension of rules that would
allow another vote on his amendment. That would take 67 votes.
Senator Tom Harkin, one of the midwestern senators who
strongly support ethanol, told agriculture.com that he doesn’t
take much comfort from that.
Harkin said he doubts Coburn will get 67 votes. But any
vote on the amendment would show exactly how much support Coburn has. If he
gets 62, for example, that’s a signal that Cobern has enough support get his
amendment passed with another bill, Harkin said, “and we’ll lose the tax credit
and we won’t have anything to replace it with. That’s my big worry”
Harkin said that he tried to get Senate passage of a
provision in last December’s tax bill that would have cut the ethanol tax
credit by 20% but would have also added infrastructure to support the ethanol
--a mandate for more flexible fuel vehicles that can burn
up to 85% ethanol blends
--grants to help retailers install blender pumps that can
dispense varying levels of ethanol in gasoline
--and loan guarantees for a dedicated pipeline to
transport ethanol from the Midwest to the East Coast.
Harkin said the ethanol industry didn’t
support that approach at the time. At the last minute, the Senate supported
maintaining the full tax credit for the rest of this year.
If Coburn succeeds in repealing the ethanol tax credit,
Harkin said he’ll still try to get legislation passed to build ways for ethanol
to reach the market. But ethanol industry supporters will have lost a key
On the floor of the Senate Thursday, Coburn said that his
support for repealing the ethanol tax credit is part of his larger effort to
end waste and to recover revenue for the federal government.
“It is not popular for me in Oklahoma to eliminate the
blenders credit on ethanol,” Coburn said. “We have a lot of corn farmers. But
the fact is the very people who get this, British Petroleum, Valero, Exxon
Mobil, Chevron don't want it.”
“I've got a letter from them saying they don't want the
blenders credit. That's who gets it,” Coburn said. “Only 16% of the ethanol is
produced by farmer cooperative ethanol plants. 84% is not. It's produced by the
big boys. They're saying they don't want it. So why don't we save $5 billion
between now and the end of the year? Because we're going to borrow 47% of it.
Why would we do that to our children?”