I 
109TH CONGRESS 
2D SESSION 
H. R. 6212 
To amend the Internal Revenue Code of 1986 to provide a tax incentive 
to produce ethanol in high-consumption, low-production States, and for 
other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 27, 2006 
Mr. HIGGINS (for himself, Mr. HINCHEY, Mrs. NAPOLITANO, Ms. CORRINE 
BROWN of Florida, and Ms. JACKSON-LEE of Texas) introduced the fol-
lowing bill; which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
a tax incentive to produce ethanol in high-consumption, 
low-production States, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Ethanol Stimulus Act 
of 2006’’. 
SEC. 2. ETHANOL PRODUCTION TAX INCENTIVES IN HIGH- 
CONSUMPTION, LOW-PRODUCTION STATES. 
(a) IN GENERAL.—Section 40(b)(4) of the Internal 
Revenue Code of 1986 (relating to small ethanol producer 
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credit) is amended by adding at the end the following new 
subparagraph: 
‘‘(E) CREDIT FOR ETHANOL PRODUCTION 
IN TWO-TWO STATES.— 
‘‘(i) IN
GENERAL.—In the case of 
qualified ethanol production by any eligible 
small ethanol producer in all eligible eth-
anol production facilities of such pro-
ducer— 
‘‘(I) subparagraph (A) shall be 
applied by substituting ‘20 cents’ for 
‘10 cents’, and 
‘‘(II) subparagraph (C) shall be 
applied by substituting ‘50,000,000 
gallons’ for ‘15,000,000 gallons’. 
‘‘(ii) 5-YEAR
PER
FACILITY
LIMITA-
TION ON CREDIT AMOUNT.—With respect 
to each eligible ethanol production facility, 
the credit determined under this section by 
reason of this subparagraph shall apply to 
production from such facility for the pe-
riod— 
‘‘(I) beginning with the taxable 
year during which production from 
such facility begins, and 
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‘‘(II) ending on the last day of 
the fourth taxable year following the 
taxable year described in subclause 
(I). 
‘‘(iii) ELIGIBLE
ETHANOL
PRODUC-
TION FACILITY.—For purposes of this sub-
paragraph, the term ‘eligible ethanol pro-
duction facility’ means any ethanol produc-
tion facility the original use of which com-
mences with the taxpayer and— 
‘‘(I) which is acquired by pur-
chase 
(as 
defined 
in 
section 
179(d)(2)) by the taxpayer after Au-
gust 8, 2005, and before August 9, 
2010, but only if no written binding 
contract for the acquisition was in ef-
fect before August 9, 2005, 
‘‘(II) which is acquired by the 
taxpayer pursuant to a written bind-
ing contract which was entered into 
after August 8, 2005, and before Au-
gust 9, 2010, or 
‘‘(III) in the case of a taxpayer 
constructing property for the tax-
payer’s own use, the construction of 
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which begins after August 8, 2005, 
and before August 9, 2010, 
in a State which is a two-two State on the 
date of such purchase under subclause (I), 
of such written binding contract under 
subclause (II), or the beginning of such 
construction under subclause (III). 
‘‘(iv) TWO-TWO STATE.—For purposes 
of this subparagraph, the term ‘two-two 
State’ means for any period any State (as 
determined by the Energy Information Ad-
ministration) within which— 
‘‘(I) is consumed more than 2 
percent of the aggregate amount of 
gasoline consumed in all States during 
such period, and 
‘‘(II) is produced less than 2 per-
cent of the aggregate amount of eth-
anol produced in all States during 
such period.’’. 
(b) ELIGIBLE SMALL ETHANOL PRODUCER.—Sec-
tion 40(g)(1) of the Internal Revenue Code of 1986 (defin-
ing eligible small ethanol producer) is amended by insert-
ing ‘‘(150,000,000 gallons in the case of such productive 
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capacity in all two-two States (as defined in subsection 
(b)(4)(E)(iv))’’ after ‘‘60,000,000 gallons’’. 
(c) CONFORMING AMENDMENT.—Section 40(g)(2) of 
the Internal Revenue Code of 1986 is amended by striking 
‘‘For purposes of the 15,000,000 gallon limitation under 
subsection (b)(4)(C) and the 60,000,000 gallon limitation 
under paragraph (1)’’ and inserting ‘‘For purposes of each 
gallon limitation under subsection (b)(4) and paragraph 
(1)’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to ethanol produced in taxable 
years ending after the date of the enactment of this Act. 
Æ 
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