Governor's Ethanol Coalition


Iowa Gov. Terry Branstad, Chair * Indiana Gov. Frank O'Bannon, Vice Chair * Missouri Gov. Mel Carnahan, Past Chair

Arkansas Gov. Mike Huckabee
Colorado Gov. Roy Romer
Hawaii Gov. Ben Cayetano
Illinois Gov. Jim Edgar
Kansas Gov. Bill Graves
Kentucky Gov. Paul Patton 		Michigan Gov. John Engler
Minnesota Gov. Arne Carlson
Montana Gov. Marc Racicot
Nebraska Gov. Ben Nelson
New Mexico Gov. Gary Johnson
North Dakota Gov. Ed Schafer 		Ohio Gov. George Voinovich
Oklahoma Gov. Frank Keating
Puerto Rico Gov. Pedro Rosello
South Dakota Gov. Bill Janklow
Texas Gov. George Bush
Wisconsin Gov. Tommy G. Thompson

News Release
For Immediate release
June 9, 1997		 For more information contact:
Larry Bean 515-281-4308


Elimination of Ethanol Incentive
to Cost Consumers $5.4 Billion Yearly



DES MOINES -- A newly released study shows the proposed elimination of the federal partial excise tax exemption for ethanol-blended fuels will cost consumers nationwide $5.4 billion a year in lost jobs, lower income and higher gasoline prices.

"As this study clearly demonstrates, eliminating the ethanol tax incentive will raise taxes on American consumers," Governor Terry Branstad, Chairman of the Governors' Ethanol Coalition, said. "It just doesn't make sense to destroy an industry that is saving the federal government more than $3.5 billion a year and generating thousands of American jobs when the alternative is higher gasoline prices, higher taxes and lost jobs."

According to the state-by-state analysis, elimination of the ethanol tax incentive would result in the following annual negative impacts on consumers:

According to the study, elimination of the tax incentive will result in a tax increase on the 12% of the nation's fuel that is currently blended with ethanol. Areas not meeting pollution standards will experience higher fuel costs due to an increased demand for oxygen. Consumers will also see increased fuel costs as refiners and marketers find replacements for octane and volume currently met with ethanol. Household income and jobs attributable to the economic activity generated by consumer savings from the ethanol tax incentive will also be lost in the absence of ethanol.

The study was done by John Urbanchuk of AUS Consultants for the National Corn Growers Association and the Renewable Fuels Association.

Copies of the study are available from the Coalition.

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Governors' Ethanol Coalition
P.O. Box 95085
Lincoln, Nebraska 68509-5085
(402) 471-2867 phone || (402) 471-3064 FAX
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