Biodiesel tax credit revival looks promising as deadline nears

By Ron Kotrba | December 17, 2019

As the Dec. 20 budget dealine nears to avoid a U.S. government shutdown, Reps. Abby Finkenauer, D-Iowa, and Cindy Axne, D-Iowa, submitted two amendments Dec. 16 to H.R. 5377—the Restoring Tax Fairness for States and Localities Act—that would revive the expired $1 per gallon biodiesel blenders tax credit and extend the $1.01 tax credit for second-generation biofuels. The amendments Finkenauer and Axne proposed Dec. 16 sought to extend the biodiesel tax credit through 2020, but in the early morning hours of Dec. 17, a new rule amendment was passed, seeking extension of the biodiesel tax credit through 2022. If passed, the biodiesel tax credit would be available retroactively from Jan. 1, 2018, through Dec. 31, 2022, and the second-generation biofuel credit would be available through 2021.

“As the Congress considers bills this week to extend and adjust tax provisions, we are determined to fight for the investments that will support our farmers, rural communities, and good-paying green jobs,” Axne said. 

“I have stressed to House leadership how important this credit is,” Finkenauer said. “I will keep working to make sure I get this done for Iowans. Today’s amendments are another push to get that done.”

“This is an amendment that will be added to one of the appropriations bills [Dec. 17],” Paul Winters, director of public affairs and federal communications, told Biodiesel Magazine. “The House is expected to vote on appropriations today [Dec. 17] or tomorrow [Dec. 18].* The Senate will follow, and it should be signed by Friday [Dec. 20].” Winters says NBB remains optimistic as the organization works to ensure that the credit is passed.

“Today’s announced deal provides the policy certainty that the biodiesel industry has been seeking to support investments and continued growth of production,” said Kurt Kovarik, said NBB’s vice president of federal affairs. “NBB and its members are grateful that congressional leaders are providing a positive signal before the year’s end.”

Grant Kimberley, executive director of the Iowa Biodiesel Board, said, “If passed, Congress’ five-year biodiesel tax credit extension would come just in the nick of time to save thousands of jobs connected to biodiesel production. This extension is exactly what we need to foster steady, predictable growth of biodiesel. Not only would this save more plants from closing—it would set the stage for a biodiesel renaissance, and give agriculture a much-needed boost too.”

*Editor’s Note: Update—The House passed two spending measures totaling $1.4 trillion Dec. 17, one of which  includes the five-year extension of the biodiesel tax credit retroactive from Jan. 1, 2018, through Dec. 31, 2022. This measure passed 297 to 120.  

 
 
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