Iowa Democratic Rep. Abby Finkenauer urges House to help biofuels industry hurt by Trump trade wars
For the second time this year, Rep. Abby Finkenauer has rallied dozens of House members to push Congress to renew lapsed tax credits that would bring “much-needed relief” to the companies that make biofuels and the agribusinesses that depend on them.
Last week the Iowa Democrat sent a letter to House leadership urging extensions of three tax incentives for biofuel companies that expired at the end of 2017. Forty members of Congress signed the Nov. 6 note to Speaker Nancy Pelosi and Ways and Means Committee Chairman Richard Neal.
Renewing the tax incentives would not only be a step “towards reducing greenhouse gas emissions … but also would bring much-needed relief to those that counted on these incentives,” the representatives wrote.
“At least nine biodiesel refining plants have already closed or significantly reduced production,” they wrote, and suppliers of seed, fertilizer, and farm machinery are suffering from the resulting drop in demand, which has led to layoffs across industries.
Iowa biodiesel producers made about 365 million gallons of biodiesel in 2018, according to the National Biodiesel Board, more than any other state. That production supports nearly 5,000 jobs across Iowa, according to a 2019 study by ABF Economics.
But since the tax credits expired at the end of 2017, economic confidence in the industry has taken a hit.
Tom Brooks, general manager of Western Dubuque Biodiesel, a biodiesel plant located in Finkenauer’s district, said the uncertainty over the tax credits “is like having to wager our company’s money at the roulette table, betting on black, but in the red.”
Finkenauer, who joined Congress in 2018, said this tax uncertainty could not be happening at a worse time.
“With farm income at its lowest point in more than a decade and our farmers caught in the cross-hairs of the President’s trade war with China, now is not the time to walk away from tax credits that have become so important to Iowa’s soybean growers,” she said in a statement. Soybeans are the key ingredient in biodiesel.
“Businesses need certainty to operate efficiently and effectively,” said Rep. Kendra Horn (D-OK), who co-led the letter with Finkenauer.
The congresswomen’s letter earned praise from trade groups such as the National Biodiesel Board, the American Farm Bureau Federation, and the American Soybean Association.
“Biodiesel and biofuel production facilities strengthen rural communities, providing jobs and growing tax revenues,” American Farm Bureau Federation President Zippy Duvall said, adding that biodiesel burns cleaner than traditional diesel fuel and helps reduce dependence on foreign oil.
“We appreciate the efforts of Rep. Abby Finkenauer to resolve the crisis and provide some welcome news to Iowa’s farmers and biofuel producers,” Brooks said.
Earlier this year, Finkenauer introduced a bill to extend the biodiesel tax credit for two years. The bill attracted 64 cosponsors, including 25 Republicans.
In June, a House committee approved legislation that extends the biodiesel tax credit and the two other biofuels incentives through 2020.
House leadership will determine any further progress on the matter, hence Finkenauer’s second push — the letter to House leadership.
“Extending these tax credits has the support of members of Congress from New Mexico to New Hampshire,” Finkenauer said. “I am hopeful that Speaker Pelosi will see the names on this letter and understand how important this is to the rural areas many of us represent.”