The Blunt Friends And Family Plan: Ethanol Edition
Just when you think that the shameless self-dealing by the Governor, his family, and close political associates can't possibly get any worse, it does.
Last January, in Governor Matt Blunt's State of the State Address, he called for full funding of the ethanol incentives fund, and he called for imposing a 10% ethanol mandate. Both measures would directly benefit anyone who happened to be in the ethanol production business.
He also said:
Please stand with me against special interests and for our farmers, consumers, the environment and new energy supplies made right here in Missouri.
What he didn't, but could have said is, "Please stand with me as I enrich my brother, and three of my closest political associates."
Because, you see, as the Governor stood on the dais in the Missouri House Chamber making that policy proposal, the Governor's brother was already planning to cash in on the Governor's initiative. And Andy was working with a few of the Governor's closest political allies, Mike Kehoe, Tom Kolb and John Kolb, to do it.
Trading on insider knowledge of the Governor's plans, last January, the younger Blunt, Kehoe, and the Kolbs formed Show Me Ethanol, LLC, a company that plans to build an $80 million ethanol plant to produce 50 millions gallons of ethanol per year.
Not only will Show Me Ethanol benefit from Governor Blunt's ethanol mandate, but it will also benefit from the ethanol incentive fund--the very fund that the Governor wanted to make sure was fully funded.
Undoubtedly, Show Me Ethanol will seek tax credits from the Missouri Agricultural and Small Business Development Authority. Conveniently for Andy, Kehoe, and the Kolbs, Governor Blunt has appointed 5 of the 7 members of that board. So they have that already taken care of.
And no doubt, Show Me Ethanol will certainly find it convenient to have Andy around when it comes time to apply for all those permits that they'll need from Governor Blunt's DNR, like a water quality permit, and an air quality permit.
And maybe Highway Commissioner Mike Kehoe can help then when it comes time to get that highway access permit that they'll undoubtedly need.
Regular Fired Up! readers will recall that this is not the first venture that Andy Blunt, Mike Kehoe and the Kolbs of Jefferson City Oil have worked together on. Back when Andy was running the Governor's campaign, Mr. Kehoe provided a massive tour bus to the Blunt campaign, in violation of Missouri campaign finance law. And guess who provided the fuel for the bus, that the Blunt campaign never got around to reporting? That's right, the Kolbs of Jefferson City Oil.
The Missouri Ethics Commission has determined that those violations warrant prosecutions, making Governor Blunt the first sitting Missouri Governor to find himself under such an investigation by the Ethics panel.
Ethanol has great promise, and farmers across Missouri should get to share in the financial benefits that will flow from increased demand. It's a shame that the people around the Governor feel the need to jump to the front of the line and take care of themselves first.
For more details on this scheme, call (573) 634-7580, and ask for Andy.
- Roy Temple's blog
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Crooked Rows
First, I want to say that the ethanol incentive fund was a good idea to spur development of an ethanol industry for Missouri's farmers. Same for biodiesel and the biodiesel fund. It took a lot of hutzpa to make the early projects work.
Now, whether Missouri can afford to play in the incentive game for the long haul is another question.
It's important to note also, that for all of the "corn" that Brother Blunt, Commissioner Kehoe and the oil slicks have been able to make through their connections uptown, they have none of the variety needed to produce ethanol. To take advantage of the tax credits they'd have to be producer-members of the managing co-op organization. And to join, they'd have to produce the kind of corn that grows in a field.
Sure they could invest. And, as investors in an organization that helps the farmers capitalize the project, they will reap the rewards of the incentive fund. It'll be worth about $15 million over 5 years.
Plus, the farmer-members (remember them) will be able to use/sell their $3 million in tax credits. So, all told, the state will have paid for just under 1/4 of the total cost of the operation.
Not too bad an investment opportunity so far -- especially one that is probably making money hand-over-fist in the current environment. ...And that's just the entitlement program.
Farmers ususally get more money for their corn when they sell to an ethanol plant. Demand drives up the price. Plus they sell the leftovers for feed so it's not waste, its a value-added product.
Then, when the plant makes a profit -- which it certainly is now with $3 gas -- investors get a dividend. (The price of ethanol mirrors gasoline since up to a 10 percent blend it's a one-to-one substitute.)
There may be money in ethanol. And the Blunt-Kehoe-Kolb cabal may have sniffed it out. But is that what's going on?
Is the investment side of the game what the Blunt-Kehoe-Kolb link is all about? I think that would discount the ingenuity of the capitol-capital gang.
I suspect that they are setting up an organization to bring capital into the project -- the kind that you need to fund infrastructure maybe, but the kind you need to keep the subsidies flowing from the pockets of Missouri's notoriously cheap citizens, certainly.
And for that, they are the right guys for the job.
Imagine having to make your case to the Gov. that you want him to appropriate funds, but that you didn't hire Show-Me Ethanol, LLC to run your organization. ...Or that you didn't allow them to graft a little of the profit off your organization by investing.
Keep your ear to the ground Roy.
Farmers take note.
how cute.....Baby Blunt has a role model
Absolutely Shameless
Is it possible that Blunt has given-up on re-election and is now focused on looting all he can from state government in the time he has left?