[Congressional Record Volume 143, Number 154 (Thursday, November 6, 1997)]
[Senate]
[Pages S11877-S11878]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DORGAN (for himself, Mr. Daschle, Mr. Johnson, and Mr. 
        Conrad):
  S. 1393. A bill to amend the Internal Revenue Code of 1986 to provide 
for the permanent extension of the incentives for alcohol used as a 
fuel; to the Committee on Finance.


                          gasohol legislation

  Mr. DORGAN. Mr. President, today I rise to introduce legislation to 
permanently extend the Federal gasohol tax incentives that are 
currently available to encourage the development and use of ethanol. I 
am pleased that Senators Daschle, Johnson, and Conrad are joining me as 
cosponsors of this important bill.
  I've been a long-time supporter of the domestic ethanol program 
because of its importance to this country's energy

[[Page S11878]]

and economic interests. And I was deeply troubled when Congress failed 
to take action earlier this year to keep these ethanol tax incentives 
from expiring in the year 2000. Ethanol is an important part of our 
domestic fuels industry, and it merits continued support via the Tax 
Code.
  The ethanol industry helps us to reduce our reliance on foreign oil. 
It also provides environmental benefits and stimulates our agricultural 
industry. In fact, one recent study found that the additional demand 
for grain created by ethanol boosts total employment by nearly 200,000 
while saving the Federal budget more than $3 billion.
  Today's ethanol tax incentive program has strong support in the 
Senate. Currently there is a 54-cent per gallon of ethanol credit 
available for ethanol blenders. Typically ethanol blenders get the full 
benefit of the 54-cent income tax credit by claiming a 5.4-cent 
exemption from the gasoline excise tax. The 5.4-cent exemption is 
equivalent to 54 cents per gallon of ethanol. Small producers are 
provided a 10-cent per gallon credit of ethanol produced, used or sold 
as a transportation fuel.
  Some of my colleagues in the Senate are now proposing to extend the 
ethanol tax incentives through the year 2007 and thereafter connect its 
future to any extensions of the Federal gasoline excise tax. Of course 
I will continue to support any reasonable efforts to extend the tax 
incentives currently available for ethanol. But I think it's time to 
make the major ethanol tax incentives a permanent part of our Tax Code, 
as are many tax incentives for other energy sectors. The legislation 
that I am introducing today will accomplish this goal.
  The overwhelming vote of 69 to 30 on the Senate floor during the 
consideration of the tax bill this summer shows that a vast majority of 
Senators strongly favor continuing the ethanol tax incentives. 
Unfortunately, the Senate's provision extending the ethanol incentives 
was dropped in conference. But the ethanol program retains the strong 
support of many Members in the House of Representatives as well, and by 
a broad coalition of Governors, farmers, environmentalists and 
consumers across this country.
  The future of the ethanol program is too important to our Nation's 
energy, environmental and economic interests to be derailed by a few 
powerful members in the House of Representatives. Allowing the ethanol 
tax incentives to expire in 2000 is short-sighted and unfair. The 
ethanol industry is no less important than the other energy sectors 
which enjoy permanent tax incentives, and the Internal Revenue Code 
should reflect this simple fact.
  I urge my colleagues in the Senate to join me in making the U.S. 
ethanol tax incentive program permanent.
                                 ______