Minnesota State Audit Encourages Corn Ethanol Subsidy Cut
by Luke Ekelund
Centered on Sustainability Blog
Recently, the Minnesota Legislative Auditor’s Office advised the legislature to cut the corn ethanol subsidy originally established in the late 1980s. Auditors reviewed the subsidy’s impact on both the corn ethanol industry and Minnesota’s economy, environment, and carbon emissions, and came out with mixed results.
A major issue involved funding distribution and the impact to the economy. The corn ethanol subsidy gave $93 million in the first five years to private ethanol companies with combined profits of $619 million. John Yunker with the Legislative Auditor’s Office stated that corn ethanol producers no longer need a subsidy from the state because producers make enough profit without the government aid. It is undeniable that the corn ethanol subsidy had some positive impacts for those not directly receiving the state aid; the subsidy resulted in higher corn prices for farmers and helped increase rural property values. But it is corn ethanol’s unclear and potentially harmful impact on rising food and gas prices that led auditors to pause before proclaiming the subsidy a success.
(More here.)
Centered on Sustainability Blog
Recently, the Minnesota Legislative Auditor’s Office advised the legislature to cut the corn ethanol subsidy originally established in the late 1980s. Auditors reviewed the subsidy’s impact on both the corn ethanol industry and Minnesota’s economy, environment, and carbon emissions, and came out with mixed results.
A major issue involved funding distribution and the impact to the economy. The corn ethanol subsidy gave $93 million in the first five years to private ethanol companies with combined profits of $619 million. John Yunker with the Legislative Auditor’s Office stated that corn ethanol producers no longer need a subsidy from the state because producers make enough profit without the government aid. It is undeniable that the corn ethanol subsidy had some positive impacts for those not directly receiving the state aid; the subsidy resulted in higher corn prices for farmers and helped increase rural property values. But it is corn ethanol’s unclear and potentially harmful impact on rising food and gas prices that led auditors to pause before proclaiming the subsidy a success.
(More here.)
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1 Comments:
Just to let you know that Governor Pawlenty using his "unallotment" authority has impacted a number of programs ... but he must have not seen the Auditors recommendation since $$12,168,000 scheduled for 2010 and 2011 are still in the budget.
Instead the Governor has impacted programs such as :
Eliminate Emergency GA/MSA
Effective Nov 1, 2009 and through June 30, 2011, eliminate grants to counties for low-income and disabled individuals or families to provide basic need items for emergency situations, most often related to housing or utilities. Generally, the money is used to pay people's rent so they aren't evicted, pay peoples utilities so they are not shut off, etc.
To qualify for the program you must be a Minnesota resident and your housing must be affordable. This means, you must have a job. Most of the time what happens is someone loses their income and they get behind in rent or utilities and then get a new job, but can't pay the balance. Without the help, they will be evicted.
Budget impact $6 million in 2010 and $9 million in 2011.
Eliminate Special Diet Funding-MSA Grants
Effective Nov 1, 2009 and through June 30, 2011, eliminates supplemental special needs payments to Minnesota Supplemental Aid (MSA) recipients for medically prescribed diets.
Budget impact $2.133 million in 2010 and $3 million in 2011.
There are many more programs that Pawlenty has cut, but these are just two that tell me which he values more Ethanol or People.
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