Production Incentives and Other Legislation
Legislation that passed during the 2006 session provides for a production incentive of $.30 a gallon for biodiesel, and at least four biodiesel plants are in the planning stages in the state currently. We had no biodiesel plants operating at the end of 2006. That incentive joins a continuing state incentive for ethanol production.
Legislation was signed by Governor Sebelius allowing an income tax credit, beginning with the 2006 tax year, for investments in new construction or expansion of an existing
entity; Kansas Development Financing Authority (KDFA) financing assistance is provided for projects provided with tax incentives under the bill.
The governor supported and signed 2005 legislation to remove the mandatory labeling requirement for E10 ethanol. That resulted in a substantial increase in Kansas E10 sales.
She also supported and signed 2006 legislation that reduced the tax on E85 ethanol by 17 cents per gallon; although not detailed in the law it is a percentage commensurate with the BTU content of E85. The bill took effect in December 2006.