NBB & IBB Annual Meeting
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1 NBB & IBB Annual Meeting September 12, 2018 Doug Struyk Carney & Appleby, PLC
2 Political Landscape 2018 Elections Governor - Reynolds/Gregg vs. Hubbell/Hart. Has been moved by national groups to tossup. Locally polling is tight.
3 Continued Political Landscape 2018 Elections House 59 Republicans vs. 41 Democrats. 13 Republican Retirements (6 in weak districts). 4 Democrat Retirements (only 1 in weak district). DLCC has targeted the Iowa House as a potential pickup. More money and talent coming to Iowa. Democrats have identified 20 targeted races that they can potentially play in.
4 Continued Political Landscape 2018 Elections Senate 29- Republicans vs. 20 Democrats and 1 Independent. Senator Johnson has retired so the Republicans will pick up one seat. Senator Hart is running for Lt. Governor making her seat very in play. Senator Allen has retired with Rep Nunn leaving the House to run in the seat. Democrat Sens Ragan, Bowman, Hart, and Kinney seats in play. Republican Sens Bertrand, R. Smith, Chelgren seats in play.
5 Recent State Legislative Successes 2015 Legislative Session Created a $.03 Differential in Fuel Tax for Blends of B-11 or Higher.
6 Continued Recent State Legislative Successes 2016 Legislative Session. Reauthorized the Promotion and Production Tax Credits. Changed B-5 to $.035 and created B-11 incentive at $.055. Implemented a 7 year sunset. Restructured Funding of Renewable Fuels Infrastructure Program (RFIP) Due to Loss of Fuel Tax Funding Mechanism. Now funded through Rebuild Iowa Infrastructure Fund (RIIF) at $2.5 million annually. Renewable Chemical Tax Credit Created in Iowa.
7 Continued Recent State Legislative Successes 2017 Legislative Session: Defended against legislation adversely impacting biofuel tax credits. Fully funded Renewable Fuels Infrastructure Program.
8 2018 State Legislative Priorities & Successes Fully fund the Renewable Fuels Infrastructure Program (RFIP) $2.5 million annually through Rebuild Iowa Infrastructure Fund (RIIF) Over past 3 years there were 122 ethanol grants and 101 biodiesel grants. Protect the production and promotion tax credits.
9 Continued 2018 State Legislative Priorities & Successes Educate Legislators on the importance of biodiesel to the Ag economy. Continue dialogue on the fuel tax differential. Sunset of July 1, 2020 Fuel distribution percentage report due January 1, 2020.
10 Impact of RFIP, Fuel Tax Differential, and Tax Credits on Biodiesel Sales and Location Product Percent Change Clear Biodiesel Locations % Dyed Biodiesel Locations % Total Biodiesel Retailers % Clear Biodiesel PBG 6,899,962 13,360,561 21,869,422 27,127,682 31,247,535 35,766,383 44,783,313 54,698, % Dyed Biodiesel PBG 528, ,925 1,400,405 1,844,872 2,099,093 1,752,126 1,929,127 2,789, % Total Biodiesel PBG 7,428,673 13,973,486 23,269,827 28,972,554 33,346,628 37,518,509 46,712,440 57,487, % Total Clear Diesel 575,052, ,794, ,035, ,456, ,573, ,137, ,108, ,826,914-1% Total Dyed Diesel 165,079, ,725, ,291, ,519, ,413, ,649, ,728, ,447,778 26% Total Diesel 740,132, ,520, ,326, ,975, ,987, ,786, ,837, ,274,692 5%
11 2019 State Legislative Priorities Educate and Press for Repeal of Sunset on the Fuel Tax Differential. Fully Fund the Renewable Fuels Infrastructure Program (RFIP). Protect the Production and Promotion Tax Credits. Educate Legislators on Importance of Biodiesel to the Ag Economy. Increase use in off road/dyed fuel.
12 Current Fuel Tax Rates in Iowa Gasoline $0.307 per gallon. Ethanol Blended Gasoline $0.290 per gallon. E-85 $0.290 per gallon. Aviation Gasoline $0.080 per gallon. Diesel Fuel (including biodiesel B10 and lower) $0.325 per gallon. Diesel Fuel (biodiesel B11 and higher) $0.295 per gallon SUNSETS JULY 1, 2020.
13 Continued Current Fuel Tax Rates in Iowa Liquefied Petroleum Gas (LPG) $0.300 per gallon Aviation Jet Fuel $0.050 per gallon Compressed Natural Gas Taxed on a gasoline gallon equivalent basis designed to equal $0.310 per gallon Liquefied Natural Gas Taxed on a diesel gallon equivalent basis designed to equal to $0.325 per gallon
14 Legislative Review of Fuel Taxes to be completed by January 1, 2020 The review shall be based upon a fuel distribution percentage formula status report containing the recommendations of a legislative interim committee appointed to conduct a review of the fuel distribution percentage formulas, to be prepared with the assistance of the department of revenue in association with the department of transportation.
15 Continued Legislative Review of Fuel Taxes The report shall include recommendations for changes or revisions to the fuel distribution percentage formulas based upon advances in technology, fuel use trends, and fuel price fluctuations observed during the preceding sixyear interval; an analysis of the operation of the fuel distribution percentage formulas during the preceding six-year interval; and a summary of issues that have arisen since the previous review and potential approaches for resolution of those issues.
16 Continued Legislative Review of Fuel Taxes The first such report shall be submitted to the general assembly no later than January 1, 2020, with subsequent reports developed and submitted by January 1 at least every sixth year thereafter.
17 2018 State Tax Reform Bill The bill established a 2019 Interim Tax Credit Study Committee to evaluate tax credits available under Iowa law, including Iowa s utilization of tax credits as a tool for promoting and supporting economic growth and development. The study committee shall also consider new or different tax credits or incentive programs, or tax rate or structure changes, that will foster economic growth and improve Iowa s overall tax and economic development climate.
18 Continued 2018 State Tax Reform Bill ABF Economics - In Iowa, biodiesel: supports 3,800 jobs. contributes $457 million in GDP. supports $278 million in household income.
19 Continued 2018 State Tax Reform Bill Nationally, biodiesel contributes 63 cents per bushel to the price of soybeans. reduces the price of meal for livestock by $21- $41/metric ton. Without biodiesel farmers would see an 11% cut in the cash price of soybeans.
20 Future Budget Impact of Tax Credits
21 Status of the State s Budget
22 Need a Unified Message, Cooperation, and Teamwork Put the coalition back together that passed the extension of the production and promotion tax credits and RFIP. Will they coalesce around the fuel tax differential? IBB ISA ICGA IRFA AGP ADM Cargill PMCI Truck Stops Casey s, Kum & Go, KwikStar
23 Continued Need a Unified Message, Cooperation, and Teamwork Need conversations back home in the district with legislators. Can we do more tours similar to what IRE did at their Washington, Iowa plant?
24 Homework Try to make three touches between now and January with your legislators. Senator and Representative.
25 Continued Homework How do I do this? Plant Tour Invite them to coffee Sign up for their newsletter Attend and introduce yourself at a forum or townhall meeting (you can go to more than one) Send an or letter introducing yourself or referencing something you read about them. Volunteer at a campaign headquarters Ask for a yard sign Attend a fundraiser
26 QUESTIONS?
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