Bomke praises legislation promoting Illinois' renewable fuels industry         

[JAN. 14, 2006]  SPRINGFIELD -- State Sen. Larry Bomke, R-Springfield, is supporting a bipartisan initiative that promotes the ongoing development and expansion of the alternative fuel markets in Illinois and establishes a standard for the amount of renewable fuels consumed in the state.

Bomke explained that the initiative will not only establish standards for the amount of renewable fuels consumed in Illinois, but also seeks to encourage the success of Illinois' biofuels market by rolling back the state sales tax exemption on ethanol and using the resulting windfall revenues to support and expand the ethanol and biodiesel fuels programs and infrastructure.

"This legislation will provide a boost to the state's ethanol and biodiesel fuel industries and have a positive impact on the agricultural community and Illinois farmers," said Bomke. "By lending a hand to the state's number one industry, this initiative will undoubtedly stimulate economic development and create well-paying construction and manufacturing jobs throughout the state."

The proposed standard for motor fuel would establish that a minimum of 10 percent of all motor fuel consumed in Illinois must be pure ethanol by 2008, and by 2012, 15 percent of all motor fuel consumed in Illinois will be pure ethanol. Bomke explained that this will give the fuel industry time to adapt to the changes and will offer flexibility as these standards are implemented.

Additionally, the bill calls for a slight rollback to the state's current state sales tax incentive on ethanol from its current rate of 80 percent of the state sales tax to a rate of 90 percent of the state sales tax on July 1, which will continue until Dec. 31, 2015. It is estimated that from the changes made to the sales tax incentive, the state will realize a minimum of $57 million in new revenue growth in the first year.

The goal is to use the additional revenues realized by the changes in the sales tax incentives to encourage additional growth within the biofuels market. The legislation seeks to dedicate:

• $25 million annually in fiscal 2007 and 2008, followed by $15 million annually in subsequent budget years, for the Renewable Fuels Development Program. The money will be used in the construction or expansion of renewable fuels production facilities.
• $5 million annually for the Department of Commerce and Economic Development for the renewable fuels programs and activities.
• $3 million annually for grants for E-85 infrastructure and marketing programs.
• $3 million annually for enhancement programs to be conducted on ethanol research between Southern Illinois University Edwardsville, Western Illinois University, the University of Illinois and the National Center for Agricultural Utilization Research Center in Peoria.
• $3 million for a one-time appropriation to the National Corn to Ethanol Research Facility at SIUE for expansion and upgrades.
• $1 million annually for ethanol research development at the National Corn to Ethanol Research facility.
• $500,000 for the Illinois Environmental Protection Agency to assist in the processing of ethanol facility air permit requests.
• $500,000 for biodiesel infrastructure grants.
• $1 million annually for the Corn-to-Hydrogen Fuel Cell Research Program.

"This legislation will not only benefit the agriculture industry; it will create jobs, reduce our dependency on foreign oil producers, help the environment and further establish Illinois' position as one of the nation's leaders in renewable fuels production," said Bomke.

[News release from Sen. Larry Bomke]

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