The Impending Collision of Biofuels Mandates with Market Reality (via Farmdocdaily)

In the face of a small corn crop and high prices, there has been a great deal of debate about a partial temporary waiver of the Renewable Fuels Standards (RFS) mandate for ethanol in 2013. Our analysis of the likely impacts of such a waiver can be found here. While the headlines have focused on the short-term implications of waiving the ethanol mandate in 2013, a potentially much larger issue looms on the horizon. Beyond 2013, there are real questions about the feasibility of meeting the ever-increasing requirements of the RFS, and this concern goes beyond the well-known difficulties with meeting the mandate for cellulosic biofuels. The purpose of this post is to show why the RFS is likely to collide with market realities in the near future.

We begin by reviewing the RFS requirements for minimum domestic biofuels consumption in the U.S. as summarized in Table 1. There are three categories in the RFS and each has its own minimum volumetric mandate: renewable, advanced, and total. Renewable biofuels is generally assumed to be corn-based ethanol but this is actually not explicitly required by the RFS legislation. Instead, corn-based ethanol has been the cheapest alternative for this category that also meets the environmental requirements of the RFS. Advanced biofuels has three sub-categories: cellulosic, biodiesel, and undifferentiated. Cellulosic biofuels have been in very limited supply, so the Environmental Protection Agency (EPA), the government agency charged with enforcing the RFS mandates, has written down the cellulosic mandate to near zero (8.65 million gallons in 2012). The biodiesel mandate was established as a minimum of one billion gallons per year from 2012 through 2022, with larger amounts subject to EPA approval. That mandate has been set at 1.28 billion gallons for 2013. A key point is that to date the EPA has not written down the total mandate for the RFS at the same time as it has reduced the mandate for cellulosic biofuels to near zero. This means that the burden of fulfilling the total advanced component of the mandate has fallen almost entirely on the biodiesel and undifferentiated categories.

This article can accessed in its entirety by visiting http://farmdocdaily.illinois.edu/2012/09/the_impending_collision_of_bio.html

 

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Client Spotlight: Iowa State Dairy Association

The Iowa State Dairy Association (ISDA) was chartered by the Iowa legislature in 1876. At this time the leading concerns of the association were breeding profitable cows, inducing farmers to use a silage program, improving the quality of butter and Bovine tuberculosis. These issues would continue to stay in the forefront for many years to come. The ISDA also played a major role in the fight to open a dairy school in Ames.

By the 1980’s the organization’s efforts had been idle in the industry. In 2001 the ISDA board began a restructuring effort to build the ISDA back into a successful and significant organization within the industry.

With the restructuring of the a new vision for the association was developed. In 2003 the association hired a staff member to re-organize and build the ISDA into an active voice representing the Iowa dairy producer. In 2006 another staff member was hired to assist with the existing position.

ISDA will provide the forum through which members of the dairy industry can help facilitate and implement policies that have a direct impact on dairy producers in Iowa. ISDA is dedicated to building a strong communication link between producers, consumers, legislators, and environmental organizations. Each contribution by its members insures this producer-driven group remains viable. This is important as you reflect on how valuable ISDA is in your life and your operation.

 For additional information regarding the Iowa State Dairy Association visit http://www.iowadairy.org/about/index.html

Media Release: Aronnax Public Strategies Adds 11 State Government Affairs Teams to “FedState Network”

Aronnax Public Strategies, a strategic partner of RDL & Associates, has officially launched their “FedState Network”.  Below is the media release announcing the State Government Affairs teams that comprise the Network, which includes RDL & Associates.

Please contact Dave Ladd, President of RDL & Associates at daveladd66@gmail.com with questions or if you are interested in exploring how this unique governmental affairs model might benefit your company or organization.

FOR IMMEDIATE RELEASE

Aronnax Public Strategies Adds 11 State Government Affairs Teams to “FedState Network”
Clients receive a unique combination of federal and state-based advocacy for policy and financial goals

WASHINGTON, D.C. – Sept. 26, 2012 – Aronnax Public Strategies LLC (APS) today launched the FedState Network, a unique governmental affairs model that provides clients with a combination of federal advocacy from APS and state-based advocacy from some of the most influential and respected state-based government affairs firms in the country.

“The teams created through the FedState Network represent the future of a seamless government relations strategy,” said Andy Garfinkel, principal at APS.

To date, APS has signed on 11 state partners to the FedState Network, which provides collaboration between federal and state government affairs teams. The FedState Network approach creates additional opportunities and efficiencies, providing clients with a true team approach that integrates various business and policy goals when it comes to their government relations needs. The FedState Network will continue to focus on both politics and policy, representing interests in agriculture, energy and environment, transportation, economic development, homeland security, tax policy and long-term financing, among others.

“As federal representatives, the APS team has long recognized the importance of state-based advocacy as part of a client’s overall government affairs strategy,” said Fred Starzyk, principal at APS. “State lobbying and federal lobbying are not mutually exclusive.”

APS clients who take advantage of the FedState Network receive unique insight into the political, legislative, and regulatory landscapes in key states and regions. APS will also provide clients with ongoing alerts of state solicitations, federal grants, and procurement opportunities.

The enhanced federal and state collaboration of the FedState Network will allow APS to easily identify and engage in often overlooked opportunities, as well as join with state partners to coordinate projects and responses to joint proposals. State clients will also benefit from the ability to use Capitol Hill and APS resources for lobby days and meetings on Capitol Hill.

“We recently worked with APS to meet with several New Mexico Pueblos to discuss the joint government affairs strategy that the FedState Network offers,” said Drew Setter, principal at The Setter Group in Albuquerque, N.M.  “Since then, we’ve secured a new client and expect two others to finalize contracts. The idea of a seamless government affairs team – both federal and state – working on behalf of their interests was the major reason these clients decided to sign with us.”

Currently, the FedState Network includes government affairs teams in Georgia, Idaho, Michigan, Minnesota, Mississippi, New Mexico, Puerto Rico, South Carolina, Texas, Virginia, and Wisconsin. For more information please visit www.aronnaxllc.com/aronnax-public-strategies-federal-advocacy.php.

About Aronnax Public Strategies LLC

Launched in 2012, Aronnax Public Strategies LLC (APS) is more than just a lobbying firm in the heart of our nation’s capital. APS offers a wide range of services including federal lobbying, strategic advocacy planning, grassroots organizing, public relations, policy research services, legislative tracking, grant writing and procurement, association management and federal contracting services. Through decades of experience, APS professionals create private and public partnerships for clients, organize advocacy campaigns and promote legislative and regulatory objectives. APS leaders have extensive experience in the federal authorization, appropriations, tax writing, grant writing and procurement processes for nationally significant objectives. For more information, visit www.aronnaxllc.com.

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Media Contact:
Nina Velasquez
North 6th Agency
212.334.9770
nvelasquez@n6a.com

Tom Latham Blames Eric Cantor on Farm Bill (via Politico)

Iowa Rep. Tom Latham says Speaker John Boehner wants to bring the farm bill to the floor, but is being stifled by his leadership colleagues.

Latham, a close ally of Boehner’s (R-Ohio), said on Simon Conway’s radio show in Iowa Tuesday that “Eric Cantor is the one who controls floor activity” and the Virginia Republican “honestly believe(s) that they cannot pass it.”

“John Boehner is not the problem,” Latham said.

The farm bill has passed the House Agriculture Committee, and has been hanging in limbo ever since. The Senate passed a bill, and rural farm states have been up in arms at Republican leadership, which refuses to bring it to the floor. The Wall Street Journal editorial page gave leadership reinforcement Tuesday, when they said leadership shouldn’t bring it to the floor because it spends too much money.

But Latham’s party is in power, and he is in a tight member-on-member race against Rep. Leonard Boswell (D-Iowa). He wants the bill brought to the floor, and hashed out there. Latham said on the radio show that leadership is nervous about internal conflict over the bill.

“What they tell me, they don’t want to blow up the alliance with the urban members and the farm state members that we have always had to pass a farm bill,” Latham said. “They think that would be in jeopardy. They tried to come out and say it’s in the best interest for farmers to keep that coalition together and don’t have a bill that fails. I think in my mind you bring it to the floor and you fix it and that’s how you get the votes to do it.”

Conway asked Latham if people should be blaming Cantor for the bill being stalled.

“Well, he controls the floor schedule and I will tell you I have had several conversations with the speaker and he is all for bringing it to the floor,” Latham said.

Cantor’s office says it’s more complicated than that.

“House leadership is in agreement. Moving a reauthorization or extension before there is consensus – and there is currently none – would not be wise,” Cantor spokesman Doug Heye said. “In the meantime, the House has acted on important livestock disaster aid. The Senate has not.”

The story can be accessed by visiting http://www.politico.com/news/stories/0912/81407.html

No Farm Bill Action Before Election (via Congressional Quarterly)

The 2008 farm law will be allowed to expire Sept. 30, with House Republican leaders unlikely to schedule any action this week on either a new farm bill or an extension of the 2008 law, said House Agriculture Committee spokeswoman Tamara Hinton.
Congress is recessing after this week until the election. “At this point, we don’t expect any additional items to be added to the House schedule for the week,” Hinton said.

 

Congress could take another stab at passing a new farm bill after the election or consider an extension then.
House Agriculture Chairman Frank Lucas, R-Okla., had supported a one-year or three-month extension of existing programs but the idea ran into opposition from farm groups, conservative organizations and Democrats. Lucas “remains committed to completing a farm bill this year,” Hinton says.

 
Rep. Bruce Braley, D-Iowa, is circulating a discharge petition to force a vote on the committee’s farm bill, but that is considered a long shot.

 
Eleven Republicans had signed the discharge petition but two of those — Scott Tipton of Colorado and Reneee Ellmers of North Carolina — withdrew their names. House conservatives are being warned by the Club for Growth against signing the discharge petition.

The Club, one of Washington’s most influential conservative groups, said Monday that signing the petition would “count heavily as an anti-growth action” on its congressional scorecard.

 
At least 218 members, a majority of the House, must sign the petition for it to force a vote on the legislation. Such petitions are seldom successful, and even when they are, it takes months to gather sufficient signatures, according to the Congressional Research Service.

 
In early July, the House Agriculture Committee approved a five-year measure (HR 6083) to renew farm and nutrition programs last authorized in 2008 (PL 110-246). The bill calls for $35 billion in cuts over 10 years, including $16.1 billion to the nation’s largest food aid program, the Supplemental Nutrition Assistance Program (SNAP). But conservatives have said from the beginning that those cuts, especially to SNAP, are not nearly enough.

Congress Bets on Post-Election Edge, Delaying Action (via NPR)

Congress roared into town last week after a five-week break. Lawmakers will be heading back home just as quickly this week. They’re expected to complete exactly one big item before pulling the plug on this briefest of sessions: a stopgap spending measure that keeps the government from shutting down during the next six months.

Members of both parties prefer tackling the mountain of unfinished business they leave behind only after the November election.

When the Republicans who control the House of Representatives drew up their legislative schedule for this fall, they planned to be in session until the second week of October. But Majority Leader Eric Cantor announced a change of plans when he wrapped up the House session on Friday.

“We no longer anticipate votes in the House during the week of Oct. 1. This is a change from the original House calendar,” he said.

Steny Hoyer, the chamber’s number-two Democrat, reminded Cantor that unlike the Democratic-led Senate, which has passed a five-year renewal of the massive farm bill, the House has yet to take up its own version, even though the current one expires in two weeks.

“Is there any possibility that before we leave here, in consideration of the crisis that confronts many in the farm community, that we will consider that bill?” he asked.

Hoyer, of course, was well aware that House Republicans are deeply divided over the farm bill, and that their failure to act on it would likely help Democrats at the polls. Cantor tried putting the best face on a tough situation.

“Yes, there could be a possibility there’s some action next week on the issue of the farm bill. Looking to find ways that we can work together on issues that we all support, not issues that divide us,” he responded.

The reality, though, is that apart from the stopgap spending measure that prevents a shutdown neither party wants before the election, there’s little reason for either Democrats or Republicans to cut deals now, knowing they could have more leverage as a result of the election.

“I mean, obviously it’s a very different universe on the other side, if it’s president-elect Romney that we’re dealing with and a Republican Senate,” says Tom Cole, a House Republican from Oklahoma. “And look, that’s true for the Democrats as well. They know that, and so they’re not willing to make any deals before the election.”

That angers some lawmakers, like Republican Rob Wittman from Virginia. On Friday, he railed on the House floor about Congress having done nothing to prevent $100 billion in automatic spending cuts next year, half of which carve into defense spending.

“Congress should stay in Washington and stop ignoring the reality of these looming cuts. It is time to put governing over politics,” he said.

But Democrats say the threat of those automatic cuts, known as sequestration, is the only thing that will compel Republicans to agree to a deficit-reduction deal after the election that includes tax hikes on the wealthy.

“To the extent that we start backing off … this deal, that was struck a year ago, that puts the gun to our head, compels us to act responsibly,” says Sen. Tom Carper of Delaware. “We start picking that apart, then we end up maybe doing nothing.”

In the end, says Oklahoma Republican Cole, nothing can really get done until each party knows what kind of a hand it’s been dealt at the polls in November:

“I tell voters at home, please look at these issues carefully, because the votes you cast are really not just gonna be just for the individuals, they’re gonna solve these issues in relatively short order,” he says. “We have to reach resolutions on these issues, and I think we probably will, but it’ll be the people that win in November that make those decisions.”

Democrats, meanwhile, are accusing House Republicans of simply trying to run out the pre-election clock.

“I guess the Republican plan is to do next to nothing, and to get out of town as quickly as possible,” says Rep. Jim McGovern of Massachusetts, “even though we just got back from a five week recess, in hopes the American people don’t notice we were even here.”

But they will be back for a post-election lame duck session, when they may be more disposed to cutting deals.

House GOP Takes Temperature for Three-Month Farm Bill Extension (via Roll Call)

House Republican leaders are whipping a three-month extension of the stalled House farm bill, a measure that would drop the bill into the middle of what will already be a contentious lame-duck session.

House Agriculture Chairman Frank Lucas (R-Okla.) said today he is seeking support from his colleagues for the short-term measure and pushing for a House vote next week.

“I think anyone who looks at the circumstances is going to acknowledge that you can’t do a complete farm bill by next Friday, therefore we’re going to do a farm bill in [the] lame duck,” he said.

With the elections approaching, he said politics prevent passage of a full bill. Still, leadership has yet to decide whether to bring the measure up next week, and Lucas said that neither Speaker John Boehner (R-Ohio) nor Majority Leader Eric Cantor (R-Va.) have committed to a vote on any farm bill.

As Lucas whipped the measure at a House vote today, however, Agriculture ranking member Collin Peterson (D-Minn.) let off a tirade near the House floor, saying that he is strongly opposed to any short-term extension of the farm bill.

“If anybody would take the time to learn what the hell is really going on here, people would understand. Ninety-eight percent of people in this town have no goddamn idea what’s going on and they’re spouting all this nonsense,” he said. “I’m tired of it.”

Peterson noted that although the farm bill expires Sept. 30, the negative effects, a sharp spike in dairy prices, for instance, would not take effect until January. An extension would make it more difficult to pass a five-year farm bill, he said.

“This is strictly political cover is all this is, to make it look like they’re doing something,” he said. “What upsets me is he’s whipping something that is really irrelevant. And they never whipped the farm bill. They just said, ‘Well, we don’t have the votes.’ Why the hell didn’t they whip it? If they have time to whip this, what the hell? Why aren’t they whipping the bill?”

Still, the measure would have some Republican support. Rep. Reid Ribble, a freshman Republican who sits on the Agriculture Committee, said he is pushing for a one-year extension but is eager to pass something to give certainty to dairy farmers in his home state of Wisconsin.

“The reality is they weren’t going to get it through the House in time to get a conference report anyway, which meant it was going to be in the lame duck no matter what,” Ribble said. “I think you’re going to have to do something.”

The extension is likely to meet the same headwinds that have kept any farm bill from the House floor this year. Republican Study Committee Chairman Jim Jordan said he is still opposed to any farm bill because it does not include enough changes to farm programs.

“I’m against it, and I don’t particularly care for the three-month because, remember, our goal was to keep things out of he lame duck,” the Ohio lawmaker said.

Peterson said that agriculture industry groups would probably also oppose a short-term extension, as they have been pushing lawmakers to pass the five-year bill.

 

Client Spotlight: Minnesota Farmers Union

Since 1942, the Minnesota Farmers Union (MFU) has worked through its grassroots membership to promote and improve the lives of all people whether you are in a rural community, a farmer or a consumer, urban or rural. MFU works to provide an effective grassroots voice for our members in both St. Paul and Washington D.C., as well as working with all forms of government administrations from the smallest township to the federal government.

MFU policy is set and controlled by our membership. Ideas and support for MFU policy come from resolutions set at local conventions held with in MFU’s over 70 county organizations. Resolutions passed at the county level are then sent to the state level for consideration, and if passed are placed in the permanent policy document.

For additional information regarding Minnesota Farmers Union, please visit http://mfu.org

 

Lucas Says One-Year Extension the Only Viable Option on Farm Bill (via Congressional Quarterly)

More than 200 people called on the House on Wednesday to pass the Agriculture Committee’s farm bill, but hours later its chairman said an extension of the current law may be the only option left this year.

The 2008 farm law (PL 110-246) expires Sept. 30, and a coalition of agriculture, conservation and food groups are publicly pressing House leaders to move the committee-approved bill (HR 6083) to the floor this month, although privately several say they believe House action may be more likely in a postelection session.

If the House passed its farm bill, negotiations with the Senate for a compromise could begin. The Senate passed its version (S 3240) in June, but House leaders have kept the House Agriculture Committee bill off the floor because of disagreements among GOP rank-and-file members over spending cuts for the Supplemental Nutrition Assistance Program, formerly known as food stamps.

Frank D. Lucas, an Oklahoma Republican and chairman of the House Agriculture Committee, said he worries that House Republican leaders could cancel or shorten a lame-duck session if the GOP takes the White House and the Senate in November.

 
He raised the specter of 1940s farm law taking effect if Congress does not deliver a farm bill or an extension. Farm bills suspend permanent law during the years in which they are in effect. Reverting to those provisions would boost federal payments for dairy and commodity crops significantly above current levels. Economists estimate that federal dairy supports would reach $38 to $51 per 100 pounds of milk if the old law took effect after current dairy programs expire Dec. 31. Under the Milk Income Loss Program, the current target price is $16.94 per hundredweight for fluid milk.

 
The supports under permanent law are based on parity prices, the difference between what farmers receive in market prices and their costs for fertilizer, seed, feed and other so-called inputs. Farm programs have not reverted to permanent law since the start of modern farm bills in 1973.

 
Lucas said he prefers a one-year extension in September, given his concerns about the lame-duck session and the scheduled departure of House members next week to do fall campaigning.

 
“There’s not time before Sept. 30 to do a bill on the floor, to prepare the legal paperwork to go to conference and to prepare the paperwork of a conference report and bring it back to both houses for a vote before the clock runs out,” Lucas told reporters.

 
He said House leaders should be able to focus on a farm bill extension after the expected House passage of legislation (H Res 117) to provide short-term funding for the federal government until March 27. Lucas said he thinks there would be support for an extension, adding that he got fewer pointed questions from caucus members earlier this week when he discussed the farm bill than in July, when House leaders scuttled a one-year farm bill extension attached to a drought aid bill because of opposition.

 
Lucas acknowledged that he has no commitment from “senior management,” as he calls House leaders, that the chamber will act on an extension before the election. “The bottom line is something has to happen,” he said.