Heineman: Ethanol is a good fit for state

TRENTON -- One size doesn't fit all in Nebraska, Gov. Dave Heineman said this morning during a press conference at the Trenton Agri Products ethanol plant. Gov. Heineman and Sen. Tom Baker, of Trenton, smiled and laughed as they explained the benefits of Nebraska's new tax incentive package that will take effect Jan. 1, 2006. The package, the governor said, will provide opportunities for growth for all Nebraskans, rural and urban.

"Nebraska is a big state," Heineman said, "and everyone needs the opportunity to grow. What we did with this incentive package can benefit everyone."

"We aren't going to build an ethanol plant in Lincoln or Omaha," Heineman said. Nor is it likely, he said, that a PayPal operation would be located in Trenton. However, the governor said, the state's new incentive package addresses the needs of both rural and urban Nebraska.

The incentive package can create 57,000 new jobs over the next eight years.

Tiers of qualifications are designed to attract smaller companies and expand available tax breaks to manufacturing equipment. The rural portion of the package includes $2.5 million for seven years for ethanol plant incentives.

"There's no question ethanol is critical to our state," Heineman said. With this new incentive package, Heineman said, "there's no doubt we can fund ethanol incentives."

Heineman said he knows ethanol leads to good-paying jobs, less expensive fuel and a cleaner environment.

Sen. Baker said he was pleased with the expanded tax exemptions on business and manufacturing equipment. He said he plans now to work to reduce or eliminate personal property tax on the same equipment.

The incentive package includes $15 million for job training, which, Heineman said, will mean money funneled through community colleges, state colleges and the state's university system.

Baker said welders for a new trailer manufacturing plant at Beaver City (in the development stages) will be trained through McCook Community College, accessing funds from the new incentive package.

Ralph Scott, Trenton Agri Products plant manager, said the plant's first employees were trained two years ago in six weeks of classes in Trenton and at an ethanol plant in Russell, Kan.

Charlie Wilson, president of Trenton Agri Products, said, "Our employees had six weeks of training before we ground the first bushel of corn."

Wilson said it was Nebraska's tax incentives that brought the ethanol plant to Trenton several years ago. "Our investment group is from Kansas," Wilson said. "We could easily have built this plant in Kansas."

Wilson told Heineman, "We appreciate the incentives from a prior administration, and the continuity that exists with you, Gov. Heineman."

Wilson said, "We feel great about our investment in Nebraska."

Wilson said overcapacities of ethanol may make the industry's future a little bleak for a while, however, he said, relying on ethanol product credits and depending upon incentives will even out the rough times and assure that workers will not be laid off.

Wilson said incentive funding may also help with a proposed CO2 sequestration project in which CO2 from the ethanol plant would be captured and piped to a nearby oilfield which would use it to enhance oil recovery. "It's a win-win situation," Wilson said. "We take the CO2 out of the atmosphere, enhance oil recovery and preserve jobs."

Heineman said he sees the new incentive package as a way for Nebraska to compete not only in a world market, but also with 49 other states. "We live in a dynamic, competitive marketplace," Heineman said. "We have to be flexible and adaptive to be able to be continuously competitive."

"The real world needs tax incentives," Heineman said.

Heineman said executives tell him that the work ethic of Nebraska employees is already a incentive. "They know their workers come to work, there's a low turnover and low absenteeism," Heineman said.