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Legislature takes credit but does nothing for consumers

A half a loaf usually is better than none at all, but whether Louisiana consumers got half a loaf is debatable in the Legislature’s machination regarding SB 474 to ameliorate the negative effects of HB 685.

HB 685, now Act 313 of the 2006 Regular Session, would commit the state’s gas distributors to make sure that at least two percent of their product is in ethanol when its production rises above 50 million gallons a year, no later than six months after. The problem is the cost of making the ethanol vastly exceeds now and for the foreseeable future will exceed that of gasoline processing, as well potentially cause environmental hazards.

A sweetheart deal between Gov. Kathleen Blanco and Agriculture Sec. Bob Odom said Odom, in charge of most aspects of the new law, would not implement it unless the price of ethanol production roughly was equivalent to that of pure gasoline. But this gave Odom so much discretion in an unenforceable way that it did little to assuage consumers’ fears.

So, in an amendment attached to HB 454, the Legislature attempted to put into statute a requirement that the new law would go into effect only after the price of ethanol was no more than 10 cents a gallon more expensive over pure gasoline over a 90-day average, even if after the 50 million gallon standard had been reached. The state Senate still must agree to the change, rather strayed from the bill’s original intent, but no doubt Blanco would sign it.

As previously noted, the arrangement between Blanco and Odom could work out well politically for both. Blanco appears to have done something meaningful to please consumers, even if it isn’t, and threw a bone to agricultural and environmental interests, while Odom gets more regulatory power than ever, helps out his friends, and no doubt will find a way to declare ethanol prices meet the proposed standards as quickly as possible, even if they do not. The Legislature now joins this credit-taking parade by arguing it gave force to a measure to save consumers money.

However, its effort hardly carries more substance than the handshake agreement. It doesn’t restrict Odom’s discretion in the matter; a serious attempt to protect consumers would have specified legally in great detail how the determination of the price band would occur.

If the Legislature really had meant business, if it really wanted to do something substantive rather than symbolic, it would have repealed Act 313. But I guess that’s too much to ask if you want to please a few special interests and fool the rest of the public. Once again, it’s Louisianans that suffer at the hands of the state’s government.

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