Senate to vote again on ending ethanol industry tax breaks on Thursday

The Senate will vote again Thursday on a plan to strip a major ethanol industry tax break and end the ethanol import tariff.

Forty senators voted for the measure Tuesday, well shy of the 60 votes needed to advance the plan, when Sen. Tom CoburnTom Coburn-trillion debt puts US fiscal house on very shaky ground Al Franken: 'I make fun of the people who deserved it' The more complex the tax code, the more the wealthy benefit MORE (R-Okla.) offered it as an amendment to an economic development bill.

But the politics of Tuesday’s battle were clouded by Democratic anger at Coburn’s surprise procedural move last week that set up the vote.

Majority Leader Harry ReidHarry ReidChris Murphy’s profile rises with gun tragedies Republicans are headed for a disappointing end to their year in power Obama's HHS secretary could testify in Menendez trial MORE (D-Nev.) said Wednesday evening that the Senate would vote on Sen. Dianne FeinsteinDianne Emiel FeinsteinGun proposal picks up GOP support Gingrich: Banning rapid fire gun modification is ‘common sense’ House bill set to reignite debate on warrantless surveillance MORE’s (D-Calif.) identical version of the amendment tomorrow.

Lawmakers will then vote on Sen. John McCainJohn Sidney McCainRubio asks Army to kick out West Point grad with pro-communist posts The VA's woes cannot be pinned on any singular administration Overnight Defense: Mattis offers support for Iran deal | McCain blocks nominees over Afghanistan strategy | Trump, Tillerson spilt raises new questions about N. Korea policy MORE’s (R-Ariz.) amendment that would block use of federal funds for the construction of ethanol blender pumps or storage facilities. Both will need 60 votes to pass.

Feinstein said on the floor Tuesday that the plan Coburn offered would have been successful absent the controversy over his procedural tactics.

“I believe if it weren’t for the process, we would have 60 votes,” Feinstein said. Democratic leadership had whipped against Coburn's amendment.

The tax amendments mirror legislation that Feinstein and Coburn introduced earlier this year that would quickly end the 45 cent credit for each gallon of ethanol that fuel blenders mix into gasoline, and end the 54 cent-per-gallon import tariff that protects the domestic industry.

The blender's credit resulted in $5.4 billion in foregone federal revenue last year, according to the Government Accountability Office

But while Feinstein was optimistic, ethanol retains powerful political support from Corn Belt lawmakers in both parties.

Thrown onto the defensive over the billions of dollars in tax credits that benefit the industry, they are floating plans aimed at altering the incentives without killing them outright.

Sens. John ThuneJohn Randolph ThuneGun proposal picks up GOP support Overnight Regulation: Senate panel approves driverless car bill | House bill to change joint-employer rule advances | Treasury to withdraw proposed estate tax rule | Feds delaying Obama methane leak rule Dems see Trump as potential ally on gun reform MORE (R-S.D.), Amy KlobucharAmy Jean KlobucharFacebook shifts strategy under lawmaker pressure Competition law has no place raising prices some say are ‘too low’ CNN to host town hall featuring Nancy Pelosi MORE (D-Minn.) and other ethanol backers this week floated a bill that would end the 45-cent per gallon ethanol blender’s credit (which is slated to expire at year’s end), but maintain a smaller and “variable” blender’s credit for three years when oil prices are below certain levels.

It would steer some savings from ending the credit to deficit reduction, while also extending credits for cellulosic ethanol production, small ethanol producers, and installing alternative fuel pumps.

Feinstein has held out the prospect of a compromise. “Whether we can do this or not, I don’t know, but I am certainly willing to try,” Feinstein said Tuesday.