Politico

The White House has been pretty clear in recent days: Federal student loan payments will resume Feb. 1 as President Joe Biden lifts the nearly two-year pandemic-era pause despite pressure from many in his own party to extend it.

Behind the scenes, that political reality has led the Biden administration to conduct Zoom meetings with allies in the student loan forgiveness space in an effort to make the resumption of loan repayments as smooth as possible.

But despite their no-drama intent, the confabs have not always been smooth sailing.

One such “tense meeting,” described by someone familiar with what happened in the conversation, happened Wednesday. Loan forgiveness advocates relayed to members of Biden’s domestic policy and economic teams that beyond the actual economic, legal and policy implications of lifting the loan repayment pause, the move was “bad politically.” They wanted “to sound the alarm to them about what we believe to be a very serious political mistake that they’re about to be making,” said a second source familiar with the conversation.

Biden’s team was not moved.

Multiple sources familiar with what was said at the meeting described the administration’s message as effectively that borrowers had two years to prepare for this and knew the pause wouldn’t last forever. One administration official in the meeting suggested that overall, the pandemic was trending in the right direction, and that resuming student loan payments is part of getting back to normal.

The White House also “pulled that kind of bullsh– of ‘the fundamentals of the economy are strong,’ which is devoid of reality,” the first source familiar with the conversation added. “Yeah, sure, the stock market may be better. Unemployment numbers are better — yes, absolutely. But in terms of real wages, in terms of how people are feeling in their pocketbook, it’s just completely delusional.”

In the eyes of debt forgiveness advocates, the ramifications of lifting the pause are dire. Not everyone is feeling the effects of a rebounding economy. Rising prices and now a new coronavirus variant are causing widespread unease. And going into an election cycle, a decision like this could affect turnout and enthusiasm — especially among younger voters, who are already unreliable midterm voters.

Arisha Hatch, vice president of Color of Change, did not attend the meeting but described the political outlook this way: “Our early research showed that people would be making political decisions based on that issue. When you combine it with an entire narrative about the difficulties that Democrats are having [in] pushing forward an economic agenda that actually offers relief to people, lots of folks were wondering: What is the narrative, what is the story, what is the push when you go back to the voters in this upcoming election cycle?”

Some of the debt forgiveness advocates left the meeting feeling like the White House doesn’t yet have a full plan in place. “It felt like the tail wagging the dog,” a third person familiar with the meeting put it. “Like someone at some point, some number of months ago said, ‘We can’t keep this thing paused forever.’ And so everybody went into execution mode, and nobody actually stopped to think about what they were doing. And now we’re here.”

The White House declined to comment on the record about the meeting, but administration officials again insisted that the loan repayment pause was always meant to be temporary, and pointed to actions the administration has already taken in this realm — including forgiving “$12.7 billion in student loan debt.”

One administration official said to expect announcements “in the coming weeks and months” on what resources will be available so that borrowers who have already been struggling through the pandemic can hop on the right payment plan, including deferment.

“The Department of Education is taking a number of steps to ensure that it’s not just some sort of cold turkey” situation, the official said. “We are trying to take every step possible to do right by the borrowers.”

As for the Department of Education’s review of whether Biden has the authority to unilaterally cancel at least $10,000 of student debt per borrower — which Biden campaigned on — administration officials said that conversations are still happening and no final determination has been made. An official did say that Biden is still ready to sign a $10,000 student loan forgiveness bill into law if Congress can pass it.

Unemployment is dropping, and the economy, by many measures, is humming. But spiraling inflation is creating a serious drag on the economic recovery and hurting President Joe Biden’s approval ratings. This week, Playbook co-author Ryan Lizza chats with Jared Bernstein, a member of Biden’s Council of Economic Advisers, and POLITICO’s Kate Davidson about Build Back Better and the administration’s response to rising costs throughout the economy.

On Build Back Better and inflation:

“Once this thing ramps up, it will increase and expand the economy’s productive capacity, by which I mean by standing up an accessible, affordable child- and elder-care sector. It will provide a pathway into the labor market for a lot of people that has never existed in this country in a sufficient magnitude. Other advanced economies have affordable, accessible child- and elder-care sectors, and those economies have higher participation rates of the very people we’re talking about. We firmly believe we can increase the economy’s quote supply side, its productive capacity over the longer term through building back better. Then the infrastructure plan does some of the same things on the physical capital side, investing in public goods that have long faced just terrible disinvestment. This is the view of dozens of economists, including Nobel laureates, who have written this down, even some of the folks who have criticized us on inflation. Over the longer term, it eases the inflationary pressures. Over the near term, it doesn’t put upward pressure on inflation. In fact, it eases some of the costs that families face.” — Jared Bernstein, White House Council of Economic Advisers Member

On sectors of concern:

“Housing is a really important sector. It has a very heavy weight in the CPI, 30 or 40 percent depending on which flavor you’re looking at. Part of our broader agenda here, having to do with racial equity, means that we have to really take hold of the supply problems in the housing market, particularly the lower end of the housing market. I worked very closely on this with our housing team, and we have very ambitious plans in Build Back Better to improve not just the supply of housing, but the low end of housing supply. So that’s that’s key in that space.” — Jared Bernstein, White House Council of Economic Advisers Member

“There are growing worries about inflation in the housing sector, shelter costs, because they make up such a large share of household budgets, but especially for people near the lower end of the income scale. Low-income families, a big chunk of their paycheck goes toward shelter or rent in particular. I think that the concern is that that could be the next area where we’re seeing bigger price increases. But I also think a lot of economists expect that the supply-chain issues won’t be resolved very quickly.” — Kate Davidson, POLITICO Morning Money author

On consumer spending trends, inflation and port issues:

“When the pandemic hit and there was this lockdown, two very important things happened. One was that people started spending less money on services. They were not going to restaurants, they weren’t traveling. They weren’t spending money on hotels. That meant that they could spend more money on goods. At the same time, some of the relief plans helped provide more resources to families to help get them through this period. Now all that spending on goods interacted with pandemic-induced supply-chain snarl-ups that meant getting goods through the ports from ship to shelf is going to be a challenge. That’s where we’re intervening. But strong demand plus constrained supply equals elevated prices. That’s why we have a supply-chain task force, of which I am a card-carrying member. What this task force does is, we’re looking at the most granular aspects of the supply chain and trying to unsnarl them so that these goods can flow through them speedier and get from ship to shelf more quickly. We’ve helped move the ports of Long Beach and Los Angeles, where 40 percent of our imports come through. We’ve helped them move them to a 24/7 schedule. We’ve helped to reduce dwell time. Dwell time is how long a container sits in a port. That’s down by about a third because of the work that we’re doing with the ports and, you know, this kind of public-private partnership.” — Jared Bernstein, White House Council of Economic Advisers Member

On inflation, transitory and otherwise:

“In the early months of our administration, when these kinds of arguments were starting to surface, we were actually very clear that we thought that the rescue plan would generate some economic heat. But we were also clear that we believe that heat [is] not equal to overheat. Yes, we emphasized that these measures get into the economy. They do a lot of very important work, and then they get out. So you can label it with whatever word you want. But I think the key fact is that clearly prices are highly elevated, and that’s a real concern of our administration. But every forecast you see has them considerably lower in the second half of next year. Now, we have to be absolutely prepared for those forecasts to be wrong. The kinds of actions I just described in the supply chains are very much where we want to be in that space. But that is the kind of temporal story of how we envision this. But here’s the part that gets lost: The elevated inflation cannot be looked at in isolation as the only thing that has come out of the work of our administration because that would be not just objectively and politically unfair, it would be a real mistake in terms of learning from our actions and their economic impact. The poverty rate in 2020 was lower than the poverty rate in 2019.” — Jared Bernstein, White House Council of Economic Advisers Member

“Extending jobless benefits, I think people thought that that made sense because there were still a lot of people out of work. But some folks said, ‘Do we really need to send another round of stimulus checks to people?’ I think they definitely didn’t anticipate that their policies would drive inflation up as much as it has. It’s not as though they looked at this and thought that this was a likely scenario and decided to go ahead anyway. They definitely did not anticipate that. When people would raise this question of inflation, the response was, ‘We know there’s going to be some inflation because prices really plummeted at the very beginning of the pandemic.’ One year later, when you compare it to prices a year earlier, it looks like they were much higher. But really part of it was prices coming back up to pre-pandemic levels. But their answer was, ‘Look, if we get inflation higher than we expect or than we’re comfortable with, the Fed has the tools to deal with that.’” — Kate Davidson, POLITICO Morning Money author

President Joe Biden acknowledged Thursday that negotiations over his Build Back Better bill are poised to drag on into 2022 despite efforts and pledges by Democrats to get it done before Christmas.

“It takes time to finalize these agreements, prepare the legislative changes, and finish all the parliamentary and procedural steps needed to enable a Senate vote,” the president said in a statement. He said that he spoke to Democratic leaders in Congress, Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer, earlier Thursday and they plan to “advance this work together over the days and weeks ahead; Leader Schumer and I are determined to see the bill successfully on the floor as early as possible.”

With the holidays approaching and the Senate eager to leave town on Friday, however, a vote isn’t likely until after New Year’s Day.

The statement is a recognition that the president’s team has so far failed to persuade Sen. Joe Manchin (D–W.Va.) to sign onto anything resembling the $1.75 trillion social spending and climate mitigation bill passed by the House of Representatives last month.

“In these discussions, Senator Manchin has reiterated his support for Build Back Better funding at the level of the framework plan I announced in September,” Biden said in his statement. “I believe that we will bridge our differences and advance the Build Back Better plan, even in the face of fierce Republican opposition.”

“My team and I are having ongoing discussions with Senator Manchin; that work will continue next week,” he added.

The drawn-out negotiations come at a vulnerable moment for the Biden presidency after months of anemic polling. The White House remains confident they will get a deal eventually but it is almost certain to be far short of their original ambitions, which included trillions more in spending and, among other things, free community college nationwide.

It’s unclear how much longer the negotiations will go on. Manchin has said that he believes many of the short-term programs in the House bill are budget gimmicks that hide the true cost of the bill. He has urged colleagues to include only 10-year programs in the final legislation to match the 10-year window on tax revenues. Manchin and Biden spoke twice on the phone this past week to try to find a way forward on the legislation but they remain far apart.

The White House has treated the Manchin relationship delicately and with more carrots than sticks. Biden has been careful not to put much external pressure on Manchin through public criticism, though his frustration has been growing.

Thus far, the president’s delicate approach has proven slow but effective, ultimately securing Manchin’s votes for the other large parts of Biden’s agenda, including the American Rescue Package and a $550 billion infrastructure bill that earned bipartisan support.

Biden is also limited by the fact that many of the traditional levers of power — potential primary challenges or pledges of presidential support — are less effective with Manchin, given that he is the only Democrat in the Senate to have won in a state that former President Donald Trump also won by 40 points.

The White House wants to mark the new year with a forceful push for voting rights, portraying the protection of the ballot as a battle for democracy itself. But despite a renewed emphasis from an increasingly impatient and frustrated base, prospects for legislative success still look grim.

West Wing aides believe that fresh federal efforts to defend the ballot and install safeguards ahead of the midterm elections are likely to be dashed by some Democrats’ resistance to changing the Senate filibuster, a reluctance spearheaded by Sen. Joe Manchin (D-W.Va.).

The White House has been considering connecting the voting rights drive with the upcoming first anniversary of the Jan. 6 riot at the U.S. Capitol, making the case that the most sacred tenant of America’s democracy remains under siege one year after the insurrection fueled by the election fraud lies told by former President Donald Trump.

To strongly make that case, the president and his team had been hoping to clear the legislative deck by the Jan. 6 anniversary. But the president’s social spending bill, known as the Build Back Better Act, appears stalled for the foreseeable future in the Senate, with Manchin’s refusal to commit to the $1.75 trillion legislation seemingly certain to push the measure into early 2022.

Biden signaled on Wednesday that he’d be fine with prioritizing election reform for the time being, saying: “If we can get the congressional voting rights done, we should do it. … There’s nothing domestically more important than voting rights.” But, previously, White House aides had consistently signaled that they wanted the social spending bill first and voting rights second.

That sequencing has irked some of the president’s most fervent supporters, who fear he may get neither.

“The time is now. The urgency could not be more palpable than it is now,” said Rev. Al Sharpton, president of the National Action Network and a Biden confidant, who, like others, argued that voting rights should have been the administration’s top priority in the wake of the moves by nearly 20 Republican-led legislatures to tighten state election laws.

“An inaction at this point would lead to an inaction of Black voters. People are saying, ‘If they don’t do this, I’m not voting,’” the civil rights leader said. “People are saying they feel betrayed.”

Echoing the sentiment of a growing number of Democrats who feel that Biden has simply not placed the defense of voting rights and elections at the center of his presidency, Sharpton said activists are now targeting Martin Luther King Jr. Day in mid-January as an unofficial deadline for at least showing some real progress on voting rights. He and other activists plan to ramp up their criticisms of Democrats — with potential threats to refrain from campaigning ahead of the midterms — if action is not taken.

“I don’t want to become too dramatic,” said Rep. Emanuel Cleaver (D-Mo.), “but voting rights may be the only thing we have to at least halt the trek away from democracy.”

So far, the president’s approach to voting rights and election reform has been scattershot. A fiery speech at the National Constitution Center in Philadelphia in July was accompanied by a series of executive orders but little else. Similarly, no White House actions followed the president offering another passionate defense of voting at the virtual Summit for Democracy last week.

The White House also has not played up the findings by the Jan. 6 select committee, which unearthed text messages from Trump chief of staff Mark Meadows that hint at coordination with Republican lawmakers to prevent the certification of Biden’s win. So far, the most direct actions have been taken by the Justice Department, which sued Texas this month over its redistricting maps, alleging a violation of the Voting Rights Act.

The lack of a sustained focus is owed, in part, to the nature of the presidency. Biden’s legislative initiatives have taken longer than expected to pass. On top of that, he’s had to manage a lingering pandemic, a violent drawdown from Afghanistan, and natural disasters, including this week’s tornadoes in Kentucky.

But some of it is owed to strategic differences within the ranks. There has been some divide within the White House as to how to mark the anniversary of the Jan. 6 insurrection. Some aides believe that it deserves a somber but significant remembrance, out of tribute to those who died but also as a full-throated condemnation of the assault on democracy at the Capitol.

Other aides believe a smaller commemoration is more appropriate, not wanting to elevate Trump’s lies or risk further inflaming partisan tensions over the 2020 election.

While the full scale of what the White House is planning remains unclear, Biden is expected to deliver a speech connecting the day to the defense of the ballot, aides said.

But aides also recognize that a full court press on voting rights – even if good politics – would be doomed to fail without a change to the filibuster. And they are skeptical that they can bring reluctant Democrats on board for such changes. While Manchin has said he’s open to reforming the chamber’s rules in a bipartisan manner, he does not support nuking the legislative filibuster. Sen. Kyrsten Sinema (D-Ariz.) has warned that scrapping the filibuster could come back to haunt Democrats. White House aides, as such, have been instructed to avoid the phrase “filibuster reform,” which they believe has become toxic and spurs knee-jerk opposition.

Other Democrats are losing patience, however. Sen. Raphael Warnock (D-Ga.) delivered a passionate speech from the Senate floor this week pushing Democrats to act on voting rights, noting that the Senate just scrapped a 60-vote threshold to pass a debt ceiling hike. Rep. Jim Clyburn (D-S.C.), who has been in touch with Warnock, said he believes Democrats are “in a good place with the voting rights bill” though it’s “not the timeline that I would want.”

“I don’t want it to be constrained by trying to do it before the end of the year. I don’t know that you have to do it before the end of the year,” Clyburn, the third-ranking Democrat in the House and a close Biden ally, said in an interview. “I just want us to get a bill done that will help preserve this democracy because if we don’t, I think we’ve lost this democracy.”

As pressure ramps up, a group of Senate Democrats have been working on possible rule changes to the chamber that could, potentially, pacify the party’s more centrist members. Those senators — Angus King (I-Maine), Tim Kaine (D-Va.) and Jon Tester (D-Mont.) — met with Manchin and Majority Leader Chuck Schumer (D-N.Y.) on Wednesday to discuss Senate rule reforms.

“The longer we wait the more mischief the states are performing,” said King.

But rules changes are complicated, take time and most Democrats expect the effort to come to a head in January. And few, if any, Democrats expect success unless Biden were to use the power of his office to influence centrist holdouts—something he has so far refrained from doing.

“His voice is critically important in telling the story that democracy is in fact under threat,” said John Podesta, former White House counselor to President Barack Obama, who argued that Biden should address the matter of voting rights directly in his upcoming State of the Union address.

“I want to see Biden start running people in and out of the White House,” said Rep. Anthony Brown (D-Md.). “I want to start by seeing the president using the full leverage of his office. It’s a crisis in democracy and the president needs to address it.”

If the White House needs a reminder of the progressive pressure they’re facing on this front, they don’t have to look far. Over the past week, roughly 20 college students from Arizona have been on a hunger strike outside the White House in Lafayette Square urging action on voting rights legislation. The group, affiliated with a political non-profit founded by former Bernie Sanders campaign organizers, named Un-Pac, has met with Sinema on the issue and is expected to meet with Sen. Mark Kelly (D-Ariz.) on Thursday. The students asked for a meeting with Biden but so far have only been in touch with Justin Levitt, White House senior policy adviser on democracy and voting.

“We really wanted to talk to the Biden administration and show them that we’re here,” said Lauren Dorn, 20, an Arizona State University student and organizer with Un-Pac. Dorn had to end her hunger strike after a few days due to health reasons. “There’s hundreds and thousands of us across the country who believe in this issue.”

The Biden administration announced on Friday that it’s planning to unveil major education civil rights proposals that rewrite Trump-era rules on sexual misconduct and create new protections for transgender students in April, a month earlier than it previously expected.

Key context: The new timeline for releasing the proposed Title IX rules, which was included as part of a biannual government-wide regulatory agenda, comes amid complaints by some advocacy groups that the Biden administration is taking too long to reverse the previous administration’s policies.

The new target date announced by the Education Department is not binding but represents the agency’s best estimate of when it plans to release its new Title IX proposal for public comment.

Education Department officials have already announced their intention to significantly rewrite the Trump administration’s Title IX regulations that govern how schools and colleges must respond to sexual assault and harassment. The administration has also indicated it plans to include in the new Title IX rules a range of protections for transgender students, including their rights to access school bathrooms that match their gender identity and participate in school sports.

Catherine Lhamon, the department’s civil rights chief, said in a statement that the new April target for releasing the Title IX proposal “reflects the Department’s commitment to work as speedily as possible toward appropriate and effective regulation in recognition of the importance of ensuring equal access to education for all students and addressing the threat to equal access posed by all forms of sex discrimination, including sexual harassment.”

Advocacy groups respond: Fatima Goss Graves, president and CEO of the National Women’s Law Center, said that the administration needed to act with more urgency on repealing the DeVos-era rules. A coalition of groups had previously called for the Education Department to immediately drop enforcement of the previous administration’s Title IX policies this fall.

“Students should not have to put their rights and safety on hold,” she said in a statement. “We are pleased that the Biden administration is taking action to restore Title IX protections against sexual harassment, but this rule should not still be on the books.”

President Joe Biden addressed the families of the victims of the 2012 Sandy Hook Elementary School shooting on Tuesday, marking the tragedy’s nine-year anniversary by calling it “an unconscionable act of violence.”

Biden, who was President Barack Obama’s vice president at the time of the shooting, led the Obama administration’s effort to enact tougher gun control laws in Sandy Hook’s wake. That effort was ultimately unsuccessful when legislation to impose tougher background checks on gun sales — a bill that had been significantly pared back amid fierce opposition — failed on the Senate floor.

Recalling the day of the shooting in 2012, the president said that “for me and for Barack, the shooting at Sandy Hook Elementary School was one of the saddest days we were in office those eight years.”

“No matter how long it’s been, every one of those families relives the news they got that day,” he also said.

On Dec. 14, 2012, a single gunman shot and killed 20 first-graders and six teachers at Sandy Hook Elementary School in Newtown, Conn. Biden, in direct-to-camera remarks on Tuesday, expressed his deep sorrow for the families who lost loved ones in the shooting.

Several family members of those who were killed in Newtown founded Sandy Hook Promise, a nonprofit that has tasked itself with honoring “all victims of gun violence by turning our tragedy into a moment of transformation.” The president expressed admiration for the activism born out of such tragedy.

“I found hope in your strength as you turned pain into purpose to change the laws and the culture around gun violence,” Biden said.

Even with majorities in both chambers of Congress and control of the White House, Democrats have struggled to advance gun control legislation through the first year of Biden’s presidency. Still, Biden highlighted gun violence prevention funding in his administration’s signature social spending and climate change legislation and called for the passage of three gun violence prevention bills by the Senate, arguing that the legislation was “long overdue.”

“As a nation, we owe these families more than prayers,” Biden said. “We owe them action.”

Biden expressed sympathy for the Newtown families and those who are impacted by gun violence, saying that this grief necessitates action for prevention of future mass shooting.

“My heart breaks for you, but we have to act. We got to get it done. May God bless you all, and may God bless the loved ones who are left behind.”

President Joe Biden will nominate Sandra Thompson, currently the acting director of the Federal Housing Finance Agency, to a full term at the regulator, the White House announced Tuesday.

If confirmed, Thompson would be the country’s top housing regulator, with oversight of Fannie Mae and Freddie Mac, the government-controlled companies that stand behind about half of the roughly $11 trillion residential mortgage market.

The move comes after Thompson allies on the Hill, including House Financial Services Chair Maxine Waters (D-Calif.), urged Biden to keep her at the helm amid reports he planned to replace Thompson this fall. The White House had considered nominating consumer-lending advocate Mike Calhoun to the position.

Biden appointed Thompson in an interim capacity in June, when he fired Trump appointee Mark Calabria after the Supreme Court ruled that it was unconstitutional to restrict the president’s ability to remove the FHFA director.

Thompson will be nominated to a five-year term. As FHFA director, she would be charged with implementing the Biden administration’s plans to expand mortgage availability and reduce the racial homeownership gap using Fannie and Freddie, which buy mortgages from lenders and bundle them into securities for investors.

The Trump administration had worked to shrink Fannie and Freddie’s footprint and build their capital reserves so they could be released as private entities. But Democrats who want the companies to play a larger role in ensuring wider access to the mortgage market objected.

A transportation industry fight over vegetable oil and animal fats is heating up as the sector races to reduce greenhouse gas emissions.

Fuels made from plant and animal waste are in hot demand as companies that operate planes, trucks, trains and ships want to use them to lower climate impacts. Now, Congress is considering extra tax credits for an emerging sector: sustainable aviation fuel.

A coalition of truck stop owners and diesel distributors argues that a provision in Democrats’ Build Back Better Act would give the aviation fuel market an unfair advantage in accessing the limited supply of oils and fats, with negative consequences for the planet. SAF proponents say those concerns are overblown because clean aviation fuel is a nascent industry playing catch up, and also has strict environmental standards.

Rep. Brad Schneider (D-Ill.) led the push for the tax credits with support from airlines, environmental groups and companies that make both clean jet fuel and renewable diesel. He said the proposal is a key part of the broader effort to combat global warming.

“SAF represents the only currently viable solution to reduce emissions from aviation, whereas other transportation sectors have multiple pathways,” Schneider said in a statement. “From the beginning, our goal has been to ensure market success, to avoid supply chain disruptions, and most importantly to achieve our climate goals.”

Build Back Better would authorize a $1.25-per-gallon tax credit for SAF that reduces emissions by at least 50 percent compared with conventional jet fuel. For every additional percentage point in reduced emissions, the tax break would increase by 1 cent up to a maximum of $1.75. The subsidy would take effect in 2023.

The sweetener is larger than the $1-per-gallon tax credit for bio-based diesel, which Build Back Better would extend for another five years.

The tax break is being proposed as the Biden administration aims to slash U.S. emissions in half by 2030. Achieving that goal requires targeting the transportation sector, which is the largest contributor to the problem. Aircraft contribute about 10 percent of the industry’s emissions, while medium- and heavy-duty trucking, rail and shipping combined contribute about 28 percent, according to the EPA.

Investors are closely watching whether there will be enough feedstock available as the production of bio-based diesel and SAF expands, and there is a lot of uncertainty right now, said Prashant Rao, director of biofuels equity research at Citigroup.

“The primary concern is pace,” Rao said in an interview. “Can the feedstock market keep pace with the amount of projects that have been announced? As with any large energy project, there is also the risk that some don’t get completed.”

Kim Carnahan, director of disruption technologies at ENGIE Impact, a sustainability consulting firm, had another assessment. She said there is a limited amount of feedstock available, but it won’t be saturated until a decade or more.

By then, road transport could be moving toward electrification or other technologies like hydrogen fuel, said Carnahan, who also manages the Sustainable Aviation Buyers Alliance. The group is creating a system for tracking carbon credits generated by SAF.

Biodiesel accounts for about 9 percent of the U.S. biofuel market, while renewable diesel accounts for 5 percent, according to the Energy Information Administration. Only a few million gallons of SAF are in production, representing far less than 1 percent of the sector.

Major oil refiners including Chevron, Marathon and Phillips 66 have announced expansions into renewable diesel. Their executives also say they are watching where the SAF tax credit lands and may consider making the fuel if the economics are right. The Biden administration in September set a goal to produce at least 3 billion gallons of SAF annually in the U.S. by 2030, up from just 5 million gallons today.

One of the primary barriers to expanding renewable diesel alone is the availability of fat, oil and grease feedstock, EIA said. Goldman Sachs last year estimated there could be a 13-billion pound feedstock deficit by 2024 as more capacity starts up.

Meanwhile, studies commissioned by lobbying groups have reached conclusions that support their positions.

The Advanced Biofuels Association last week touted a report that found there is more than enough feedstock to meet forecasted demand through 2040. The consulting firm that authored that report, LMC International, prepared a separate study two months earlier for the National Association of Truck Stop Operators that determined a finite supply of waste oils and fats could shift from renewable diesel to SAF if Congress passes extra tax credits for aviation. The group used the study to bolster its opposition to the tax credits.

LMC said their two conclusions don’t conflict. There will be limited supply of waste oils and fats in the short term because it will take time to set up new supply networks, according to Andrea Kavaler, the firm’s executive vice president. Long-term, across all oils and fats more broadly, there will be enough to meet demand for biofuels.

David Fialkov, a lobbyist for NATSO and the Society of Independent Gasoline Marketers of America, said not only is there not enough feedstock to go around, SAF is also a less efficient use of those resources, because it takes more feedstock to make a gallon of it compared with bio-based diesel.

“Without parity between the biodiesel tax credit and sustainable aviation fuel, we are merely shifting carbon emission reductions away from the ground to the air with fewer benefits and a higher cost to taxpayers,” Fialkov said.

SAF is already eligible for similar incentives as bio-based diesel, including the federal Renewable Fuel Standard, said Neville Fernandes, vice president of corporate affairs and development for the Renewable Energy Group. If Congress doesn’t keep them on equal footing, companies like his could be at a disadvantage in the competition for fats, oils and greases, he said.

REG had 11 biodiesel plants, but closed one in Houston in November, and also manages one renewable diesel plant.

“Any incentive mechanism for SAF should be also and equally available for biodiesel and renewable diesel (especially if made from the same feedstock),” Fernandes said.

SAF proponents say that ignores the current market reality, which favors renewable diesel by wide margins. REG’s own president and CEO, Cynthia Warner, acknowledged this during a November earnings call, as did executives at oil refiners Phillips 66 and Marathon.

Warner said the company will continue to “optimize” for renewable diesel production given the current market conditions and customer demand. If the economics change for SAF, the company would reassess and “take action to capture the upside.”

Gene Gebolys, president and CEO of World Energy, said he expects a lot of renewable on-road fuel production for the foreseeable future even if Congress passes the extra incentives for SAF.

“We need to start now on the aviation side now,” Gebolys said. “It’s one of the hardest sectors [to decarbonize].”

He added that the SAF industry will be built on fats, oils and greases, and that he expects production can reach between 10 billion and 20 billion gallons globally with existing feedstocks.

“We also have to go to new feedstocks,” he said. “Clearly, if the end goal is to displace every drop of aviation fuel in the world — and it is — then we’re going to have to go well beyond existing feedstocks. That is a generational effort.”

Other SAF makers, including LanzaJet, say the new tax credits will help scale other technologies that don’t rely on fats, oil and greases. LanzaJet is shooting for 1 billion gallons by 2030 using alcohol-to-jet technology, the White House said in September. Velocys plans to produce 300 million gallons using woody biomass and municipal solid waste.

Analyses by the global consultant firm ICF and the Department of Energy found that while almost all SAF production today uses oils and fats, that would shift in the coming decades as other technologies scale.

“We can accomplish both — maintaining the vitality of the biodiesel industry while doing the necessary and hard work to build a new industry that is required to decarbonize aviation and maintain global economic growth,” LanzaJet CEO Jimmy Samartzis said in an emailed statement.

President Joe Biden said Monday he will travel to Kentucky later this week to survey damage left by a deadly tornado storm that struck late last week.

“We’re going to get this done — we’re going to be there as long as it takes to help,” Biden said of the response effort during a White House briefing with Department of Homeland Security Secretary Alejandro Mayorkas and other top emergency response officials.

The White House put out an advisory shortly after the president’s announcement indicating Biden will visit the U.S. Army base at Fort Campbell, which is located on the Kentucky-Tennessee border, as well as the towns of Mayfield and Dawson Springs in Kentucky.

At a news conference earlier Monday in the state capital of Frankfort, Kentucky Gov. Andy Beshear said there have been 64 confirmed deaths to date but “undoubtedly, there will be more” reported over the coming days. He said there are an estimated “105 Kentuckians that are unaccounted for” following the series of tornadoes that hit the region this past weekend.

Beshear said the tragedy has weighed on him emotionally but vowed to continue overseeing the lengthy response effort.

“Like the folks in western Kentucky, I’m not doing so well today, and I’m not sure how many of us are,” said the governor, who was elected in 2019.

He thanked the Biden administration for swiftly approving an emergency disaster declaration for the state on Saturday and the assistance the federal government has already begun providing.

“We need it,” said Beshear, a Democrat. “And we are really grateful for it.”

Senate Minority Leader Mitch McConnell also praised Biden for acting quickly.

“I appreciate the Administration’s quick work to speed resources to help deal with this crisis,” the Republican leader wrote Monday on Twitter.

Tens of thousands of homes remain without power throughout the state, and Beshear cautioned that it will take “a significant amount of time” to clear debris and other devastation wrought by the storms.

“There’s just a mountain of waste,” he said.

Still, there have been pockets of optimistic news in the days since the tornadoes hit.

Dozens of workers at a manufacturing plant in Mayfield have been rescued after Beshear previously said, based on initial reports, that it would take “a miracle” to find people alive there. However, eight people have been confirmed dead at the site and eight others remain missing.