June 28, 2019 / 2:40 PM / in 24 days

U.S. senator says he's blocking USDA nominees over biofuel waivers

(Reuters) - Senator John Kennedy of oil refining state Louisiana is blocking the confirmation of three senior appointees to the Department of Agriculture until the department butts out of parts of the administration’s biofuels policy, according to a letter he sent this week to Agriculture Secretary Sonny Perdue.

FILE PHOTO: Senator John Kennedy (R-LA) takes questions from reporters following a policy luncheon in Washington, U.S. March 12, 2019. REUTERS/Erin Scott/File Photo

The move underscores the rising sensitivity of U.S. biofuel regulations requiring ethanol in gasoline, which have split the rival oil and corn industries and torn President Donald Trump between two key constituencies in his reelection campaign.

Kennedy told Perdue in the letter dated June 27 that he was attempting to block the confirmation of three appointees now pending the Senate until USDA “ceases to be involved in all issues involving small refinery hardship waivers” under the U.S. Renewable Fuel Standard.

The RFS requires refiners to blend billions of gallons a year of ethanol to help farmers and cut dependence on foreign petroleum imports, but allows small refineries in financial distress to secure waivers to avoid the often costly obligation.

Since Trump took office, the Environmental Protection Agency – which administers the RFS - has more than tripled the number of waivers granted, including to small facilities owned by companies like Exxon Mobil and Chevron, as well as billionaire investor Carl Icahn.

This has pleased oil interests but enraged the corn industry, which argues the expansion marks an abuse of the regulation and threatens demand for ethanol. Perdue has often sided publicly with farmers on the issue, and told farmers at an event in Iowa this month that he had spoken to Trump about it and was helping to devise a fix.

“We’re going to see what we can do about that,” he said.

Kennedy said in his letter he believes the administration’s handling of the small refinery waiver program has helped support tens of thousands of jobs across the country.

“I am deeply troubled by reports that you, in your role as Secretary of Agriculture, are attempting to influence the decisions on small refinery waivers at the EPA,” he wrote.

The appointees pending Senate confirmation include Scott Hutchins as Undersecretary for Research, Education, and Economics; Mindy Brashears as Undersecretary for Food Safety, and Naomi Earp as Assistant Secretary.

“Please be advised that I will end my efforts to block these nominees when the USDA ceases to be involved in all issues involving small refinery hardship waivers, including the SRE application process,” he wrote.

Reporting by Chris Prentice; writing by Richard Valdmanis; Editing by Susan Thomas

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