Lack of Biodiesel Tax Credit Forces REG to Take Measures

April 5, 2010 | Due to the continued lapse of the biodiesel tax credit, Renewable Energy Group (REG), the largest U.S. biodiesel company, has idled its Iowa facilities at Ralston and Newton and laid off 22 employees. Since January 1, 2010, REG and its independent network plants have laid off 45 percent of their staff as a direct result of the tax credit lapse. All remaining employees have taken pay cuts.

REG has set up a Facebook fan page to help get the message out onpassing the tax credit. Industry supporters are encouraged to become a “fan” of the page “Reinstate the Biodiesel Blenders’ Tax Credit” and follow the e-mail action plan on the site. (To count, they must not only become a fan of the page but follow the directions for action there.) REG is also encouraging those affected to leave the following phone message with their legislators: “It is urgent for our industry that the biodiesel tax credit, within HR 4213, be passed and sent the president’s desk as soon as possible.”

REG has meetings set with Senator Dick Durbin (D-IL)and Congressman Steve King (R-IA) in order to talk one-on-one about the tax credit. In addition, the company is working to secure a meeting with House Ways and Means Committee Chairman Sander Levin (D-MI) in order to talk about moving the bill out of his committee.

Congress is currently adjourned for the spring district work period and will not return to Washington, DC, for legislative business until the week of April 12th. Once Congress returns, they will be in session until Memorial Day. This time period will provide the next opportunity for Congress to address legislation dealing with expired tax provisions such as the biodiesel tax incentive.

REG supplied this timeline of the biodiesel tax credit issue:

• December 9, 2010: U.S. House approves H.R. 4213, the Tax Extenders Act of 2009, which includes the biodiesel tax credit.

• January 1, 2010: Biodiesel tax credit lapses.

• February 11: Senator Max Baucus (D-MT) and Chuck Grassley (R-IA) introduce inclusion of H.R. 4213, the Tax Extenders Act of 2009, within the first jobs bill, Hiring Incentives to Restore Employment (HIRE).

• February 12: Senate Majority Leader Harry Reid (D-NV) announced his decision to move forward with a scaled-down jobs package (first jobs bill) that did not include an extension of the biodiesel tax incentive.

• February 22: Cloture called on first jobs bill. No longer possible for biodiesel tax credit to be within first jobs bill.

• March 1-8: Baucus offers substitute to H.R. 4213, biodiesel tax credit bill under consideration in the U.S. Senate. Possible for biodiesel tax credit to move within second jobs bill.

• March 9: Senate invokes cloture on second jobs bill, the American Workers, State, and Business Relief Act of 2010, including H.R. 4213, meaning the biodiesel tax credit is in a moving bill.

• March 10: U.S. Senate passes second jobs bill, the American Workers, State, and Business Relief Act, including H.R. 4213, which contains the biodiesel tax credit.

• March 17: U.S. Senate passes first jobs bill, Hiring Incentives to Restore Employment (HIRE), and sends to President Obama.

• March 26: Congress adjourns for Easter recess.

• April 1: Second jobs bill, the American Workers, State, and Business Relief Act, including H.R. 4213, containing the biodiesel tax credit, waits for action by the House Ways and Means Committee.

• April 12: Congress due to gavel in after Easter recess.