State ethanol incentives paying off in our region

Tuesday, March 23, 2004

The Nebraska Legislature made the rules and they should honor them by providing full funding for all the ethanol plants that qualify for incentives.

After all, that was the legislators' point. They wanted to spur ethanol production in Nebraska, and they have done so ... marvelously well.

Four new ethanol plants are already up and running, or will be very soon. This includes the Trenton Agri Products LLC plant, located two miles east of Trenton on the south side of U.S. Highway 34. The impressive plant will be receiving its first loads of corn this week, with production beginning soon thereafter.

The Trenton plant is a great example of how important the incentives have been. If not for the incentives, we would not have the plant, which will provide 32 well-paying jobs, as well as an excellent market for area corn production.

Trenton Agri Products is just one example of the incentives' value. New ethanol plants are also arising in Axtell, Plainview and Central City.

In an attempt to meet the June 30 production deadline, a number of other communities are striving to erect pilot plants. These smaller plants -- including one planned at Perry and another proposed for Cambridge -- would have the express purpose of producing 8,333 gallons of ethanol by June 30, 2004. That's the minimum amount specified in the ethanol incentive legislation.

The rush to meet the deadline has caused quite a stir, especially since the Nebraska Legislature has not yet figured out how to pay the incentives for the existing plants, let alone the ones which are planned. But, Attorney General Jon Bruning said the lawmakers are bound by the incentive legislation, and must pay the incentives if ethanol plants meet the qualifying criteria.

The lawmakers are squirming, however, because of the budget crunch the state faces. A couple of ideas have been put forward to raise the needed incentive money, including increases in the corn checkoff and use of a portion of the fuel tax. These sound like fair ways to approach the matter, since the added ethanol production has potential for improving grain prices and reducing the prices paid at the pump.

Lawmakers have accomplished what they set out to accomplish: namely increased ethanol production, an improved market for grain and added employment opportunities in rural Nebraska. For those reasons, the Nebraska Legislature needs to fully fund the incentive payments for all ethanol plants which meet the qualifying criteria.

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