Dear Senator:
As Congress works to reconcile the House and Senate versions of national energy policy legislationand reauthorize the federal highway and transit programs, the undersigned organizations urge youto support inclusion of a proposal by Senators Grassley and Baucus to reform the federal ethanol taxincentive in either the final Energy Bill conference report or a short-term extension of theTransportation Equity Act for the 21st Century (TEA-21).
By adding the Volumetric Ethanol Excise Tax Credit (VEETC) Act of 2003, S. 1548, our nation’s transportation infrastructure will be improved because the full amount of user excise taxes leviedwill be collected and remitted to the Highway Trust Fund (HTF). In simplifying the tax collectionsystem, all user excise taxes levied on both gasoline and ethanol blended fuels would be collected at 18.4 cents per gallon; and all excise taxes levied on diesel and biodiesel blended fuels would becollected at 24.4 cents per gallon. On average, S. 1548 would generate more than $2 billion per yearin additional HTF revenue, which would improve the ability of the federal government to addressthe nation’s transportation infrastructure needs.
Secondly, when it comes to renewable fuels, the federal government’s tax collection system will work in concert with the petroleum industry’s and independent terminal’s fuel delivery system. S.1548 creates a simplified system of excise tax collection complemented by a regimented petroleum, renewable fuel and terminal delivery system. In the event renewable fuels are blended with gasolineor diesel at the terminal, the taxes will be recorded and collected at the terminal by the positionholder; and in the event renewable fuels are blended with gasoline or diesel “below the rack," thenthe tax will be collected before the gasoline or diesel fuel leaves the terminal rack.
In addition to the agriculture, transportation, renewable fuels and local government stakeholderslisted below, S. 1548 is cosponsored by 21 senators, including the Senate Majority and Democraticleaders, and the chairman and ranking members of the Senate Energy and Natural Resources andEnvironment and Public Works Committees. The proposal was approved by the Senate FinanceCommittee April 2.
Senators Grassley and Baucus have worked with tax and transportation fuel delivery specialists inthe petroleum industry, and the transportation and renewable fuels industries to create an effectivesolution to a complicated fuel delivery and tax collection system. This proposal would create anatmosphere where sound energy policy, transportation fuels delivery, and tax and transportationinvestment policy need not be mutually exclusive. We urge you to ensure this “win-win" proposalis included in either the Energy Bill conference report or a short-term extension of TEA-21.
Sincerely,
American Road & Transportation Builders Association Renewable Fuels Association Associated General Contractors of America National Corn Growers Association American Association of State Highway and Transportation Officials American Coalition for Ethanol American Concrete Pavement Association American Corn Growers Association American Concrete Pipe Association American Farm Bureau Federation American Council of Engineering Companies American Soybean Association American Highway Users Alliance Clean Fuels Development Coalition American Society of Civil Engineers Magellan Midstream Partners American Traffic Safety Services Association National Biodiesel Board Association of Equipment Manufacturers National Grain Sorghum Producers Associated Equipment Distributors National Farmers Organization International Union of Operating Engineers National Farmers Union Laborers' Employers Cooperation and Education Trust National Sunflower Association Laborers’ International Union of North America New Uses Council National Asphalt Pavement Association Soybean Producers of America National Ready Mixed Concrete Association US Canola Association National Stone, Sand and Gravel Association National Utility Contractors Association Portland Cement Association U.S. Chamber of Commerce
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Source: Ranking Member’s News
