Introduction Statement Family Farm Energy Relief Act

INTRODUCTORY STATEMENT FAMILY FARM ENERGY RELIEF ACT

Mr. UDALL of New Mexico. Mr. Speaker, rising costs tied to current energy prices are adversely impacting family farmers rendering some farms unsustainable. In fact, I have heard from some constituents in my home state of New Mexico who cannot afford to plant crops this year due to energy prices. We are in danger of losing family farms.

That is why I rise today to introduce the Family Farm Energy Relief Act. This legislation proposes to repeal tax incentives to oil and gas companies from the Energy Policy Act of 2005 to instead provide energy rebates to family farmers.

The Energy Policy Act of 2005 provided approximately $2.633 billion in tax breaks for oil and gas companies over the next 11 years. During times of high gas prices and record profits for oil and gas companies these tax breaks are wholly unnecessary. In fact, the current administration has agreed that they are unnecessary. President Bush recently stated Congress has got to understand that these energy companies don't need unnecessary tax breaks ..... I'm looking forward to Congress to take about $2 billion of these tax breaks out of the budget over a 10-year period of time. Cash flows are up. Taxpayers don't need to be paying for certain of these expenses on behalf of the energy companies.

The Family Farm Energy Relief Act legislation redirects the monies from the Energy Policy Act to family farmers to help pay the cost of farm diesel over the next three years. Approximately 3.4 billion gallons of farm diesel were sold in the United States in 2004, 35 million gallons to New Mexican farmers and ranchers.

The rebate program gives a tax credit to qualified family farmers equaling 10 percent of yearly farm diesel expenses. Additionally, qualified family farmers who produce biodiesel for sale or personal use would receive an additional 10 cents per galon credit.

The program will redistribute approximately $870 million per year in tax credits for farm diesel expenditures and approximately $8 million per year in tax credits for biodiesel production over three years. Expenditures from this program will not exceed the $2.633 billion oil and gas tax incentives from the Energy Policy Act.

Mr. Speaker, family farmers and the Agriculture sector have been a staple of the American economy since before we were a nation. Many family farmers already face great obstacles to success and may have already succumbed to large agriculture conglomerates. The Family Farm Energy Relief Act is not meant to be a substitute for the long-term energy solutions we all seek for our Nation. As much as each of us understands the necessity of a comprehensive and balanced approach to energy development, so too should we realize that in every state there are hard-working family farmers whose monthly budgets are being stretched to the breaking point by energy costs. While we must approach this country's energy demand with the willingness to make the tough, long-range choices demanded of us, it is equally important that we heed the suffering being caused by the current high prices. Let us help ease the increasing burden of fuel costs and help ensure that these farmers remain one of the backbones of our country and our country's economy.

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