Budzinski Celebrates Proposed Rule on 45Z Eligibility for Illinois Farmers

WASHINGTON, D.C. — Today, Congresswoman Nikki Budzinski (IL-13) issued a statement on the Department of Treasury’s notice of intent to propose regulations on the 45Z Clean Fuels Production Credit and USDA’s interim rule for Climate-Smart Agriculture (CSA) practices for crops used as biofuel feedstocks. These rules reflect several of the key requests Budzinski has consistently made to the administration, which are critical for the farmers in her district.

“Since coming to Congress, I’ve been proud to fight for local farmers and advance biofuel policy. After consistently working alongside the Biden Administration, growers, and producers throughout this process, those efforts have finally paid off,” said Congresswoman Budzinski. “With guidance from the Treasury Department and USDA, we are now on track to ensure that corn and soybean growers in our district can share in the benefits of the 45Z tax credit, alongside our ethanol and biodiesel producers. This means further economic development for Illinois’ 13th congressional district and cleaner fuels in our transportation system. I look forward to working with the incoming administration to finalize these policies, which will undoubtedly strengthen the biofuels sector and support rural America.”

Budzinski has been a leading advocate for the issuance of guidance on the 45Z Clean Fuels Production Credit, aiming to provide farmers, blenders, retailers, and fuel users with the certainty and time needed to move forward with new clean fuel projects. In July 2024, Budzinski sent a bipartisan, bicameral letter to the U.S. Department of the Treasury requesting the expansion of eligible on-farm practices and the removal of bundling mandates for Climate-Smart Agriculture practices. In October, she welcomed White House Senior Advisor for International Climate Policy, John Podesta, to Springfield to hear directly from a coalition of biofuel stakeholders, industry leaders, and farm groups about the importance of creating a well-rounded 45Z policy that benefits both farmers and the biofuels industry, while reducing harmful carbon emissions across the supply chain.

The guidelines announced today offer greater flexibility for farmers looking to adopt CSA methods and qualify for the 45Z tax credit. Farmers can now choose one or more of the following CSA actions—no-till or reduced-till, cover crops, and/or nutrient management—rather than having to implement all three on the same field simultaneously, as was required under the 40B Sustainable Aviation Fuel Credit. 

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