The American Soybean Association (ASA) still needs growers at the state level to contact their members of the U.S. House of Representatives and urge them to sign on as an original co-sponsor of the biodiesel tax credit bill.

Recently, Sen. Chuck Grassley introduced legislation in the U.S. Senate to extend the biodiesel tax credit and restructure it from a blender’s to a producer’s credit. In addition to Grassley, the Senate bill has 15 original co-sponsors.  A companion bill is being prepared in the U.S. House of Representatives and needs to generate more original co-sponsors to demonstrate robust support when the bill is introduced.

To date, 43 letters were sent, and there is still time to take action through the Soy Action Center on this important issue.

ASA needs growers at the state level to contact their members of the U.S. House of Representatives and urge them to cosponsor the biodiesel tax credit bill to be introduced by Reps. Kristi Noem (R-SD) and Bill Pascrell (D-NJ). The bill would provide a 3 year extension (2017-19) of the biodiesel tax credit and shift it from a blender’s to a production credit to further promote domestic biodiesel production.

In previous years, more than 35 House members have co-sponsored biodiesel tax credit legislation and/or signed letters of support. Numbers need to match or exceed that for co-sponsors this year. Following is a list of the cosponsors of the House bill in 2016 and the Senate sponsors/cosponsors so far this year.

House Sponsors/Cosponsors 2016:

Noem (R-SD)

Pascrell (D-NJ)

Peterson (D-MN)

Loebsack (D-IA)

Blum (R-IA)

King (R- IA)

Young (R- IA)

Adrian Smith (R-NE)

Jason Smith (R-MO)

Luetkemeyer (R-MO)

Wagner (R-MO)

Guthrie (R-KY)

Bishop (D-GA)

Takai (D-HI)

Kuster (D-NH)

Cicilline (D-RI)

Senate Sponsors/Cosponsors:

Grassley (R-IA)

Cantwell (D-WA)

Blunt (R-MO)

Roberts (R-KS)

Heitkamp (D-ND)

Thune (R-SD)

Whitehouse (D-RI)

Ernst (R-IA)

Donnelly (D-IN)

Heinrich (D-NM)

Hirono (D-HI)

Murray (D-WA)

Franken (D-MN)

Klobuchar (D-MN)

Shaheen (D-NH)

Udall (D-NM)
Background information and talking points are provided below for grower use, and the Soy Action Center will connect growers with their House offices. Please spread the link broadly among grower members in your state.
BACKGROUND
The current biodiesel blender’s tax credit expired at the end of 2016. Under the structure of the blender’s tax credit, biodiesel imported to the U.S. qualifies for the $1 per gallon incentive when it is blended in the U.S. – even when the imported fuel often already receives incentives in its country of origin.  ASA and the U.S. biodiesel industry supports restructuring the tax incentive to a domestic producer’s credit, as proposed by Noem and Pascrell. Biodiesel and Renewable Diesel imports in 2017 totaled approximately one billion gallons – a third of the U.S. market. That total is expected to grow so long as foreign fuel that is already subsidized in its country of origin can be shipped to the U.S. and get an additional $1 per gallon incentive.

TALKING POINTS
We need soybean and biodiesel industry supporters to cosponsor the Noem/Pascrell biodiesel tax credit bill to demonstrate support for extension of the biodiesel tax credit.

Extending and restructuring the biodiesel tax credit would mobilize U.S. capacity and create American manufacturing jobs.  There is more than enough U.S. production capacity to meet U.S. demand. With significant underutilized capacity in the domestic industry, biodiesel producers across the country are waiting for the right policy signals to expand production.

The Noem/Pascrell bill would accomplish a critical, cost-saving reform to the tax incentive by changing it to a domestic producer’s credit that promotes domestic production instead of a blender’s credit that rewards subsidized foreign imports. Last year alone, we saw nearly one billion gallons of imports coming to the U.S. and qualifying for the tax incentive, often after the imports received additional incentives in their country of origin.

Biodiesel production benefits soybean farmers and the livestock industry. Approximately half of U.S. biodiesel is produced from soybean oil that is a by-product of soybean production, which is driven by demand for protein meal (soybeans are 80 percent meal and 20 percent oil). In addition, rendered animal fat is a significant feedstock for biodiesel and renewable diesel, further benefiting our livestock industry partners.

If you have any questions or get any feedback from your House offices, please contact Tom Hance in the ASA Washington office at thance@soy.org or 202-969-7040.