Senate vote to repeal ethanol tax credit fails, but some in GOP break ranks

A majority of Senate Republicans appeared to break Tuesday with two decades of GOP orthodoxy against higher taxes, voting to advance a plan to abruptly cancel billions of dollars in annual tax credits for ethanol blenders.

The measure, offered by Sen. Tom Coburn (R-Okla.), fell short of the 60 votes needed to overcome a filibuster threat. But it had the support of 34 of 47 Republicans, most of whom have signed an anti-tax pledge that specifically prohibits raising taxes by any means but economic growth.

Coburn has argued forcefully that Republicans must abandon that pledge if they are serious about tackling the spiraling national debt. Though the Senate turned back his measure, he said the vote nonetheless marks the beginning of the end of GOP tolerance for wasteful giveaways through the tax code.

“You’ve got 34 Republicans that say they’re willing to end this, regardless of what Grover says,” Coburn said, referring to pledge creator Grover G. Norquist, the founder of Americans for Tax Reform. “That’s 34 Republicans that say this is more important than a signed pledge to ATR.”

AINA KOA PONO asked the state Legislature yesterday to support a 15 percent tax credit for building a refinery in Pahala

`AINA KOA PONO asked the state Legislature yesterday to support a 15 percent tax credit for building a refinery here in Pahala. Chris Eldridge, who also owns American Mattress stores around the state, is an `Aina Koa Pono partner. His testimony for yesterday’s hearing describes former sugar lands, now largely used by the cattle industry between Pahala and Na`alehu, as “fallow,” and says that using land for a biofuels farm and factory would help fend off a rise in fuel prices statewide. “Building agriculturally based biofuel refineries in Hawai`i has the potential to reinvigorate Hawai`i’s struggling agriculture industry while also helping to meet the renewable energy goals of Hawai`i’s Clean Energy Initiative,” said Eldridge.

THE NUMBER OF JOBS projected for the proposed biofuels refinery and farm here in Ka`u was increased in the testimony that asks for the 15 percent tax credit. Eldridge said that in addition to 300 construction jobs over two years to build the refinery in Pahala, `Aina Koa Pono now projects 150 to 200 jobs created for the 20 to 30 years that the biofuel refinery would be in operation.

HE ALSO SUGGESTED that the tax break bill be amended to provide tax credits within 60 days after the refinery becomes operational. “We cannot emphasize enough the need for these incentives to attract private capital to invest in these projects for Hawai`i.