Rep. Earl Pomeroy (D-N.D.)
this week introduced legislation (HR 4070) that would make a number
of revisions to the tax incentives for biodiesel production, including
a five-year extension of the expiring tax credit for domestic biodiesel.
The credit is scheduled to expire at the end of the year. “A multi-year
extension will provide the certainty and stability needed to allow producers
and investors to make long-term planning decisions about biodiesel production,”
said Pomeroy in a statement. “Without this credit, biodiesel is at
a significant competitive disadvantage with petroleum diesel.”
Pomeroy’s bill is the
companion to legislation (S 1589) introduced earlier this year by Sen.
Chuck Grassley (R-Iowa), the ranking Republican on the Senate Finance
Committee, and Sen. Maria Cantwell (D-Wash.), who also is also a member
of the Finance Committee.
Both HR 4070 and S 1589
would:
- * Reform the biodiesel tax incentive
by changing the current blenders excise tax credit to a production excise
tax credit;
- * Improve administration of
the incentive, eliminate potential abuses and improve tax compliance;
and
- * Extend the biodiesel tax incentive
for five years, providing the certainty entrepreneurs need to create
jobs and expand the use of biodiesel (The incentive is currently set
to expire on Dec. 31, 2009).
Informa's contacts signal
a way will be found for at least some type of extension. But it will
come at a cost, and budget offsets may be needed—and that is a difficult
task when budget deficits are around $1.4 trillion. Still, the senators
pushing this are well respected, and Grassley is ranking member on the
key Finance Committee. It could find its way on a "minibus"
appropriations measure later this month or even into December. Informa
also would not rule out Congress taking action on the matter early in
2010, with a retroactive feature included.