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Baucus, Grassley pledge quick action on expiring biodiesel credit
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12/22/09 03:37 PM ET
Leaders of the Senate Finance Committee vowed on Tuesday to act quickly next year to reinstate an expiring tax credit that’s vital to the biodiesel industry, and make the action retroactive.
The House approved a one-year extension of the $1-per-gallon credit as part of a $31 billion package of tax extenders earlier this month. But the Senate does not plan to act on the matter until next year. The biodiesel incentive expires at year’s end.
Finance Committee Chairman Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), the committee’s top Republican, Tuesday said they would tackle the extenders package quickly in 2010.
“As soon as the Senate reconvenes next year, my intention is that we take up legislation to extend these important provisions.,” Baucus said in a colloquy with Grassley on the Senate floor. Said Grassley: “I look forward to working with Chairman Baucus to retroactively extend these provisions as soon as possible when the Senate reconvenes in 2010.”
The industry’s main trade group warned in a report earlier this month that without the incentive, which lowers the cost of buying biodiesel that oil companies blend with conventional fuel, the industry will collapse.
The industry is already producing far below capacity and has been battered by volatile commodity prices and soft demand due to the weak economy.
“Elimination of the tax credit will essentially erase all profitability in the biodiesel industry leading to a complete decline in output, expenditures, and jobs,” states a report commissioned by the National Biodiesel Board.
But while Grassley and Baucus pledged to work together, Grassley also blamed Democrats for not moving the extenders package that includes the popular biodiesel incentive.
“Several times over the last month we've talked about the precarious situation biodiesel producers are in. Because of the inaction of the Democratic leadership, the U.S. biodiesel industry will likely grind to a halt January 1,” he said on a conference call with reporters Tuesday.
The House approved a one-year extension of the $1-per-gallon credit as part of a $31 billion package of tax extenders earlier this month. But the Senate does not plan to act on the matter until next year. The biodiesel incentive expires at year’s end.
Finance Committee Chairman Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), the committee’s top Republican, Tuesday said they would tackle the extenders package quickly in 2010.
“As soon as the Senate reconvenes next year, my intention is that we take up legislation to extend these important provisions.,” Baucus said in a colloquy with Grassley on the Senate floor. Said Grassley: “I look forward to working with Chairman Baucus to retroactively extend these provisions as soon as possible when the Senate reconvenes in 2010.”
The industry’s main trade group warned in a report earlier this month that without the incentive, which lowers the cost of buying biodiesel that oil companies blend with conventional fuel, the industry will collapse.
The industry is already producing far below capacity and has been battered by volatile commodity prices and soft demand due to the weak economy.
“Elimination of the tax credit will essentially erase all profitability in the biodiesel industry leading to a complete decline in output, expenditures, and jobs,” states a report commissioned by the National Biodiesel Board.
But while Grassley and Baucus pledged to work together, Grassley also blamed Democrats for not moving the extenders package that includes the popular biodiesel incentive.
“Several times over the last month we've talked about the precarious situation biodiesel producers are in. Because of the inaction of the Democratic leadership, the U.S. biodiesel industry will likely grind to a halt January 1,” he said on a conference call with reporters Tuesday.
