Senator Chuck Grassley today said that clean, green biodiesel jobs have again been thwarted by the Democratic-controlled Senate. Nationwide, as many as 20,000 people, including Iowans, have been laid off in the biodiesel industry in large part because of the lapse in the biodiesel production tax credit. Grassley offered an amendment to the small business bill that was being debated in the Senate. Grassley’s amendment failed by a vote of 41-58.
“I was asked at nearly every meeting in Iowa about the ethanol and biodiesel tax credits, even at the Iowa-Iowa State game on Saturday. People have seen family members lose their jobs because of delays by the majority party,” Grassley said. “I have confidence that eventually the biodiesel tax incentive will be passed, but I hope it’s not too late for the thousands of people across the country who are already out of work because of the lapse.”
The biodiesel industry employed 23,000 people on January 1, 2010, including 2,000 Iowans. It’s now operating at about 15 percent, according to the industry.
Grassley and Senator Maria Cantwell filed a bill in August 2009 that would have extended the biodiesel tax credit for five years. The bill has never been acted on. Since then, Grassley has pushed to extend the credit and tried twice to get unanimous consent to pass the credit, only to be objected to by Democrats.
Grassley’s amendment would have extended for one year (through December 31, 2010) the Sec. 40A income tax credit for biodiesel and renewable diesel.
The text of Grassley’s speech before the Senate is below.
Floor Statement of Senator Chuck Grassley
Thursday, September 16, 2010
Mr. President, we have a tax bill before us that’s supposed to help small business because small business creates 70% of the new jobs. The President says that. I think you’ve got to look at the background of the high unemployment rate, particularly why it’s staying up there. Not why it got up there, but why is it still there?
I spoke last night about a lot of uncertainty that comes because of the cap-and-trade, the bank regulatory reform bill, the health care reform bill, the biggest tax increase in the history of the country coming up in fall if we don’t intervening and prevent the biggest tax increase, and a lot of other issues out there that just tell us how uncertain it is what Congress is going to do and that uncertainty keeps the entrepreneurs of America from opening up and creating jobs.
If you want to quantify how — how they’re tight fisted about the situation right now, the last figure I saw was about $2.1 trillion in the treasuries in the major corporations of America, and they aren’t making any money by storing that cash. But they don’t know what the future — they don’t know what sort of a future this Congress is going to give them so they’re just very guarded on any moves they make.
Then we have things like shutting down all the oil drilling, unemploying tens of thousands of people. Then we have what I’m going to visit with you about, and that’s the fact that we didn’t pass the biodiesel tax credit on December 31st, last year, when it sunset. That industry is shut down and 20,000 jobs lost.
It’s kind of ironic to me that we spend weeks on a bill that’s before the Senate, as legitimate as it is, to create jobs in small business when, quite frankly, there’s a lot of negative things going on here in the Congress of the United States that causes people to be laid off, or because of uncertainty, not to be hired back.
So, I want to speak about the biodiesel industry. As we’re faced today with a 9.6% unemployment rate, I have a solution that will create 20,000 jobs almost overnight.
That solution is to extend the biodiesel tax credit today.
This tax credit expired December 31, 2009, and this Democratic controlled congress has failed to extend it; even though on several occasions I and other members on this side of the aisle have taken action in that direction.
The Democratic leadership claims, as the President does, that they want more green jobs. I’m in favor of that. I’m the author of the wind energy tax credit, as an example. I’ve been a backer of ethanol. I’ve been a backer of biodiesel and this biodiesel tax credit. So there are plenty of opportunities to show that we on this side of the aisle support the President wanting to create green jobs.
If the President and the Democratic leadership want to do that, they haven’t acted to prevent the loss of green jobs in the biodiesel industry. The biodiesel industry has lost tens of thousands of jobs as a result of this neglect. It would be nice if the Democratic leadership rhetoric met with reality.
I have twice sought to have the biodiesel tax credit simply passed through the Senate by unanimous consent. However, both times my request was objected by those on the other side of the aisle.
Meanwhile, now, these biodiesel plants in Iowa and throughout the country continue to lay off workers. In fact, most of them are just plain shut down because the Democratic controlled Congress has not extended the biodiesel tax credit.
I made a speech in December when we were on the health care reform bill and said, “can’t we find some time to pass these tax extenders so that we don’t let them lapse and have all this question mark?”
Now, that’s nine months ago. Somehow we thought last December since Congress hadn’t been in session since 1895, we just ought to be in session once in 115 years, or we just had to pass this health care reform bill before the end of the year because it takes effect by 2014.
We couldn’t find a little bit of time to keep at least 20,000 people employed in the biodiesel industry.
We asked for those unanimous consents and we didn’t get it. So these workers are laid off because the Democratic controlled Congress has not extended this tax credit.
This is a simple and noncontroversial tax extension that will likely reinstate 20,000 or more jobs nationwide and at least 2,000 within my state of Iowa. By the way, this is not controversial and there are 71 other tax provisions that expired December 31, 2009. I don’t know that any of those are controversial.
So, the biodiesel industry has lost its jobs. They have fallen victim to a tactic used by a Democratic leadership to hold this noncontroversial tax provision hostage in an attempt to advance political objectives. Just last February, I worked out a bipartisan compromise on tax extenders, all of them, with Chairman Baucus to extend the expired tax provision, including biodiesel.
However, the Senate Democratic leadership decided to put partisanship ahead of the job security for tens of thousands of biodiesel workers by destroying the compromise that Chairman Baucus and I agreed to.
So I am here again to try to put tens of thousands of people back to work producing clean and renewable fuel that everybody in this country congress says that they support.
There is a difference between the biodiesel tax credit and the other tax provisions in the tax extender bill that has stalled in the Senate. The failure to extend the biodiesel tax credit before it expired has ground the industry to a halt. Biodiesel is now more expensive than gasoline. Gasoline stations know that they can’t sell biodiesel, so gas stations don’t buy it and biodiesel producers have therefore stopped producing biodiesel because they have nobody to sell it to; consequently the layoffs.
While the other tax provisions are important, most are not as time sensitive as biodiesel because they are not transactional tax incentives like the biodiesel tax credit, but instead are based on taxable year.
Unfortunately, now it’s clear that the larger extenders bill has stalled for the time being. We need to pass the biodiesel tax credit separately. The last time I sought unanimous consent which was the second time that
I did it, one of my colleagues on the other side of the aisle objected, and in the objection said something like the biodiesel tax credit was part of a larger extenders bill that they were working on.
Now that the tax extenders bill is stalled, the Senate needs to pass the biodiesel tax credit by itself. I ask my colleagues to vote yes, to waive the rules and put 20,000 biodiesel workers back to work. So, Mr. President, I move to suspend rule 22, paragraph 2, for the purposes of proposing and considering amendment 4433, which is at the desk.
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