Two tracks are still viable. First would be a major tax extender package, which could include making some provisions permanent and extend others. The “backstop” plan is the tax extender package readied by House Ways & Means Committee Chairman Kevin Brady, R-Texas, in the event that the larger package fails to materialize.
The omnibus spending plan is also still an option. Depending on the outcome relative to the larger package of tax provisions, the tax extenders still could be melded into the omnibus spending package for Fiscal 2016 lawmakers are still working on.
As for the producer versus blender credit for biodiesel, this issue remains murky in terms of the outcome. Some biodiesel-producing companies are signaling to investors that they see the credit shifting from a blender credit as it is now to a producer credit. The latter has been proposed by Sen. Chuck Grassley, R-Iowa, who is seen as key to biofuels issues in Congress.
While the biodiesel incentive is still expected to be retroactively extended for 2015 and through 2016 and potentially beyond, any shift to a producer credit would not be retroactive for 2015 and would most likely not start until April 1, 2016.
On the trade front, Argentine biodiesel producers are saying they will fight any shift in the credit to a producer credit, a provision aimed at preventing foreign-produced biodiesel from qualifying for the $1 per gallon incentive. The Argentines will likely lobby US lawmakers to prevent the shift and if that would fail, action on the trade front could be their next step. And, it would likely take the form of a WTO challenge.