Contact Your Member of Congress and Ask them to Cosponsor H.R. 3098
As a chain restaurant owner/operator or franchisee, you've seen firsthand how dramatically food commodity prices have risen in recent years and are continuing to go up now. Combine these cost increases with the high cost of energy, gas, health care and other costs of doing business, and your business really suffers. Some would say you can merely pass on these higher costs to your customers, but you know that's not always possible in this economic environment.
For decades now the federal government has had in place policies that subsidize and promote corn ethanol as a fuel additive for our cars. These subsidies have led to increased demand for corn, which as we in the food business know is at the core of our food supply. Not only is corn an ingredient in most of the processed foods we eat today, it's also the primary feed grain for several key animal proteins -- everything from beef to chicken to pork and turkey. Other grains like wheat and soybeans have been affected, too. As corn ethanol has competed with corn for food and feed, prices for all food commodities have gone up drastically.
So what can be done about it? Advocates for the environment, taxpayers and business, including the National Council of Chain Restaurants, have been successful in persuading Congress to end two of the three primary corn ethanol subsidies and supports. But the biggest one -- the Renewable Fuel Standard (RFS) -- remains in place and contributes the most to the artificial demand the government has created for corn ethanol.
The RFS is a federal government mandate that requires an ever-increasing volume of biofuels to be produced and consumed in the United States each year. Enacted by Congress in 2005 and modified again in 2007, the RFS requires the nation's gasoline makers to buy and mix biofuels -- primarily corn ethanol -- into the gas they sell. The first year the RFS went into effect -- 2006 -- the biofuels mandate was 4 billion gallons and it is steadily increasing each year until it reaches its maximum quota of 36 billion gallons in 2022.
The RFS created four categories of biofuels: conventional (corn); biomass-based; advanced, and cellulosic ethanol. Conventional corn ethanol is a first generation, food-based biofuel. Congress originally envisioned conventional corn ethanol as a bridge to the more advanced, second generation biofuels, but that has not been the case. Despite years of research development effort, second generation, non-food based biofuels still aren't commercially viable and they aren't expected to be for some time.
As a result, the vast majority of all ethanol produced and consumed in the U.S. -- over 90% -- is still corn-based. Over 40% of the nation's corn is now used to produce ethanol and the corn-based ethanol industry is even attempting to fit corn derivatives into the second generation categories of biofuels, which would lead to even more corn being diverted from food and feed to fuel.
Numerous independent studies -- from the Congressional Budget Office, National Academy of Sciences, World Bank and others -- have concluded what is already plain to see: the artificial demand for corn created by the RFS has led to higher food prices. Since the inception of this Soviet-style consumption mandate, the price of a bushel of corn has risen over 300%. Higher corn prices have led to record low amounts of corn available for animal feed, which has resulted in a 23% meat price increase due to lower output.
Higher food prices have hurt not only food retail businesses like yours, but have also led to higher expenditures on government entitlement and safety net programs in the U.S.
A Congressman from Virginia, Representative Bob Goodlatte (R-6), has introduced legislation that would eliminate the RFS. The bill number is H.R. 3098 and NCCR supports it. You can help build momentum for H.R. 3098 by sending your Representative a message asking him or her to sign on as a cosponsor of the bill. The more cosponsors on the bill, the better the chances of having the bill considered for a vote in the U.S. House of Representatives.
Elimination of the RFS wouldn't bring about the immediate end of ethanol because some demand for it would remain as a fuel source. However, ending the RFS would help alleviate much of the artificial demand for corn ethanol that the mandate creates. Less demand for corn ethanol means less pressure on corn and other food prices.
HERE'S HOW YOU CAN HELP!
Please send your lawmaker a message TODAY and ask him or her to cosponsor H.R. 3098. Either call your lawmaker's office in Washington or simply click on the link below to send them an email message, which you can edit, that details your opposition to the RFS and your request that they cosponsor H.R. 3098.
If you choose to PHONE your Member of Congress (dial the Capitol Switchboard at (202) 224-3121 for the phone number of your congressperson), feel free to cite the following TALKING POINTS in your conversation:
I am a small business chain restaurant owner/operator/franchisee in your Congressional District and I am calling to ask you to cosponsor H.R. 3098, the Renewable Fuel Standard Elimination Act.
The RFS creates artificial, excess demand for corn, which pushes up prices for corn and numerous other food commodities, which hurts my business and my customers.
Studies from the Congressional Budget Office, the National Academy of Sciences and the World Bank have documented this fact.
Since the RFS mandate went into effect in 2006, the price of a bushel of corn has risen over 300%.
Additionally, the average price of meat has risen over 23%.
The U.S. now burns over 40% of our corn as fuel for ethanol instead of as food and feed for agriculture.
Please cosponsor H.R. 3098.
Phone calls and email messages are especially needed in the offices of Members of Congress who serve on the House Energy & Commerce Committee, which has jurisdiction on this issue.
If you reside in the Congressional District of one of the following Members of Congress (click on the link below), we encourage you to ask for their support right away. Call the Capitol Switchboard at (202) 224-3121 to be connected directly to their Washington, D.C. office.
Thank you for your engagement on this critical issue for the chain restaurant industry!
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