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Governor, in Steamboat Rock, signs ethanol tax bill, calls out EPA head Wheeler

Governor, in Steamboat Rock, signs ethanol tax bill, calls out EPA head Wheeler


STEAMBOAT ROCK — Flanked by area legislators and her lieutenant governor, Gov. Kim Reynolds signed into law a bill that lowers excise taxes on gasoline blended with ethanol, and called out the head of the Environmental Protection Agency charged with approving refinery waivers that limit ethanol’s reach.

At Pine Lake Corn Processors in Steamboat Rock, a plant that produces around 80 million gallons of ethanol per year, Reynolds said the bill is an important way to circumvent “the bureaucrats in Washington, D.C., that seem more interested in the interests of Big Oil than farmers.”

The bill, Senate File 2403, puts the excise tax for gas without ethanol at 30 cents per gallon, while gas with ethanol blended in will be taxed between 24 and 30 cents depending on how much ethanol it contains.

For biodiesel, the excise tax would range between 29 1/2 cents per gallon to 32 1/2 cents per gallon.

“This is going to make higher-blended biofuels even cheaper at the pump,” Reynolds said.

Reynolds also called on EPA head Andrew Wheeler to “reject the excessive number of waivers” sought by refineries that seek to avoid blending ethanol into gasoline as required by the Renewable Fuel Standard.

“We’re going toe-to-toe with the EPA and Big Oil to do everything we can to protect ethanol,” Reynolds said.

James Broghammer, CEO of Pine Lake, said it’s a tough time for ethanol, noting some Iowa plants have closed as the economy falters and waivers cut into their business.

“I’m sure you’ve heard ethanol is not in a very happy state, but we’re still here and we’re still running,” he said.

Around 25% of U.S. ethanol production comes from about 40 plants in Iowa, Broghammer said, amounting to 4.1 billion gallons in 2019. Seventy-five percent of Pine Lake’s expenses go to pay Iowa corn farmers, he added.

“If you want to talk about an industry that supports Iowa, supports the United States, it’s ethanol,” Broghammer said.

State Sen. Randy Feenstra, who is running for U.S. Rep. Steve King’s 4th District seat after ousting King in the primary, agreed.

“It is the crux of our agricultural economy in Iowa,” Feenstra said.

Reynolds also announced an additional $7 million in federal CARES Act money will help struggling ethanol plant operators upgrade infrastructure, adding to the $3 million previously announced.

“We really want to help the biofuels industry bounce back,” she said.

Addressing the ongoing coronavirus pandemic, Reynolds said the state continued to see “positive signs of recovery,” pointing to a sub-10% positive testing rate and low numbers of hospitalizations and deaths lately.

“We’re not seeing what’s happening in Texas and Arizona and Florida,” she said.

She also announced a change in the way the Iowa Department of Public Health will track recoveries: Instead of confirming a recovered person via phone call, the state will now classify cases as “recovered” when 28 days have passed from the time of a positive test.

That immediately lifts Iowa’s recovery rate from 62% to more than 80%.

“We believe the change more accurately represents the number of recovered,” Reynolds said.

Around 20 Black Lives Matter activists protested outside of Pine Lake after Reynolds spoke chanting “Let us vote.” Reynolds hasn’t yet fulfilled a promise to sign an executive order restoring the ability to vote to those who have served their time for felonies.

Reynolds has said she would sign such an order before the November election.

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