"I have stated repeatedly that I will work to extend the ethanol tax incentive and bolster support wherever there is a possibility to do so. I will continue my effort to reduce our nation's dangerous and growing dependence upon foreign energy. Programs like the ethanol incentive, that provide a domestic energy alternative and economic development, are very important to our future both in the Midwest and across the nation," Grassley said.
The McConnell amendment was offered to H.R. 2646, the Education Savings Act for Public and Private Schools. In a procedural vote this morning, the Senate failed by only four votes to invoke cloture to move forward on consideration of H.R. 2646, which has been advanced in the Senate by Paul Coverdell (R-GA). Nevertheless, Coverdell has asked that the Senate reconsider moving forward next week. If enough senators vote to move forward, the McConnell amendment containing the Grassley-sponsored measure to extend the ethanol tax incentive to the year 2007 also would be considered for approval by the Senate. The pro-ethanol language in the amendment is identical to that advanced throughout the year by Grassley and Sen. Carol Moseley-Braun (D-IL).
In September, Grassley and Senate Majority Leader Trent Lott (R-MS) won support from the Senate Finance Committee for the Grassley/Moseley-Braun extension of the ethanol tax incentive as part of the Intermodal Transportation Act of 1997, known as ISTEA. Grassley has expressed frustration that action on a six-year ISTEA bill this year by the Senate has been derailed by partisan politics. On behalf of Iowa projects, Grassley has received assurances from the Department of Transportation that federal dollars for Iowa are available through February 1998. Grassley also has urged Senate leadership to make ISTEA a top priority when Congress returns to work in January.
As passed by the House of Representatives, H.R. 2646 would increase the annual limit on contributions to education savings accounts (education IRAs) from $500 to $2,500, and allow savings for elementary and secondary school expenses in addition to college expenses.
Current law allows taxpayers to set up education savings accounts for children under the age of 18 years and to contribute up to $500 in after-tax dollars to the account to pay for higher education expenses. Any interest accrued in the account is tax-free as long as the funds are used for eligible higher education expenses. Grassley serves as a senior member of the Finance Committee, where all tax legislation must be considered in the Senate.