From: Jim Sabin, The Lima News, Ohio
Published October 26, 2004 12:00 AM

Federal Tax Bill Includes Benefits for Ethanol, Ohio Lawmaker Says

Oct. 26—LIMA, Ohio — A tax bill that has gained congressional and presidential approval contains subsidies for smaller ethanol plants like that being proposed in Lima, U.S. Rep. Michael Oxley said.

"The bill extended the ethanol biodiesel subsidy through the year 2010," Oxley said. The bill was one of a flurry to pass at the end of the congressional session, he said.

Congress is getting more behind ethanol as the only environmentally safe oxygenate needed to serve as an additive to gasoline, Oxley said. The only other alternative, the chemical MTBE, has been outlawed in several states as unsafe for the environment.

"The only oxygenate out there is ethanol, and that's good news for Ohio, because we grow a lot of corn," Oxley said. "Farmer-owned co-ops are producing a third of our ethanol today."

So far, none of that ethanol is produced in Ohio, something Greater Ohio Ethanol plans to change with a plant on Hanthorn Road. The federal bill includes subsidies for plants that produce less than 60 million gallons Greater Ohio plans for 54 million of $1.5 million a year for 10 years.

Kruger said the congressional action brought him peace of mind, as one of the biggest risks in the ethanol industry is politics.

"I believe, from our perspective, that risk has been taken away, at least through 2010," Kruger said.

The bill also increases the amount of money returned to the state from the gasoline tax, a difference of about $150 million a year, Oxley said. That money can be applied to road work around the state, he said.

© 2004, The Lima News, Ohio. Distributed by Knight Ridder/Tribune Business News.

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