Iowa Gov. Reynolds Vetoes Controversial Carbon Pipeline Law — Supporters and Critics React

Iowans are divided in the wake of Gov. Kim Reynolds’ veto of Iowa House File 639.

The bill would have changed the common carrier definition of a carbon pipeline and made it more difficult for pipeline projects to use eminent domain. According to reporting from Iowa Capital Dispatch, House File 639 would also have “increased insurance requirements for hazardous liquid pipelines” and “limited carbon pipeline permits to one 25-year term and changed the definition of a common carrier for pipelines.”

After the bill was passed on May 12, it went to Reynolds’ desk, where she had 30 days to decide whether or not to veto it following the end of the legislative session. Iowa landowners and the ethanol industry have been outspoken during that time.

Reynolds announced her decision to veto the bill on June 11. In her letter detailing why, Reynolds said, “HF 639 isn’t just about eminent domain. It goes much further—and in doing so, sets a troubling precedent that threatens Iowa’s energy reliability, economy, and reputation as a place where businesses can invest with confidence.”

Here’s how Iowa agriculture and ethanol groups reacted to the veto. Many leaders shared their perspective on the industry’s next steps in the wake of the news.

Celebration

Iowa Corn Growers Association

Iowa Corn Growers Association (ICGA) is a 7,500-member strong grassroots-driven organization, headquartered in Johnston, Iowa, serving members across the state, and lobbying on agricultural issues on behalf of its farmer members to create opportunities for long-term Iowa corn grower profitability.

“Governor Reynolds’ decision to veto HF 639 is a win for Iowa’s corn farmers, ethanol industry, and economy. Iowa is the world’s leader in corn and ethanol production, and now there is an opportunity to increase demand for ultra-low carbon fuels, a market that Iowa deserves the ability to pursue,” the organization said in a statement.

“Participation in CCS [carbon capture sequestration] projects will allow Iowa to capitalize on exciting new ethanol market opportunities like Sustainable Aviation Fuels (SAF). Jet fuel demand is projected to be 120 billion gallons by 2035; if 10% of that market could be made into SAF from ethanol, this would equal nearly 19 billion gallons of new ethanol demand or nearly 6.5 billion bushels for new corn demand,” the statement continued.

“Iowa’s corn farmers have continued to face high input costs and decreased profit margins. They need expanded market growth and access to continue raising corn profitably; allowing them to continue growing Iowa’s agricultural industry and economy. 

“ICGA appreciates Governor Reynolds’ decision to continue championing Iowa agriculture and creating new pathways for farmer success. We thank her for her continued support and dedication to the best interests of Iowa’s corn growers.”

Iowa Renewable Fuels Association

The Iowa Renewable Fuels Association (IRFA) represents the state’s liquid renewable fuels industry and works to foster its growth.

IRFA was quick to express their gratitude for the governor’s veto. Executive Director Monte Shaw said, “This is a classic example of why our system of government has checks and balances. Any thoughtful review of this bill would determine that it would lead to higher energy prices for Iowans, hamper future economic development, hold back job creation, and stifle new markets for Iowa farmers. IRFA thanks Gov. Reynolds for listening to Iowans, studying the actual legislation, and ignoring the rhetoric that was as inaccurate as it was loud.

“After enduring the largest two-year income drop in history, farmers are desperate to find new markets,” Shaw said. “CCS, the key to unlocking massive new demand for ethanol and corn around the world, is moving forward in several states and around the world. The question is not whether CCS will happen, but rather whether Iowa will be left behind. For 25 years Iowa has benefited greatly from being the most profitable place in the world to convert corn into ethanol. Once the Tallgrass CCS pipeline in Nebraska begins operations later this year, that will no longer be the case. Thanks to today’s veto, we hope that is a short-lived situation. Otherwise, there will be very real, very severe economic consequences for Iowa.”

The debate over CCS will undoubtedly continue in Iowa, according to IRFA. “For three years, IRFA attempted to work with parties on legislation to strengthen property rights, improve the IUC [Iowa Utilities Commission] permitting process, and allow a path forward for CCS,” according to IRFA’s statement. “All attempts to find a middle ground were rejected by state legislators seeking only to kill CCS projects.”

“Despite rhetoric from supporters of the bill, it failed to enhance property owner rights and simply sought to kill all CCS projects,” Shaw said. “The legislation does nothing to enhance support for land restoration, soil compaction remediation, tile replacement, or lost yields. It did nothing to make the IUC process more flexible to avoid the use of eminent domain. Hopefully today sends a message that those interested in progress, not posturing, should work towards a middle ground approach that enhances landowner rights and protections but would allow CCS projects a path forward. IRFA stands ready.”

 American Carbon Alliance

The American Carbon Alliance (ACA) strives “to be one unified voice for carbon capture pipelines, ethanol producers, landowners, farmers, construction trade workers, and citizens that embrace this new energy future for America.”

CEO Tom Buis called Reynolds an “unwavering champion for Iowa’s farmers and ethanol producers” in a press statement, praising the governor for “defending rural America and advancing its full economic potential.”

Buis continued, “Her bold veto of HF 639 is a clear victory for Iowa’s agricultural heartland, farmers, and the ethanol industry. It sends a strong message rejecting the misguided efforts of environmental extremists who pushed this legislation. These groups have done everything in their power to undermine agriculture, ethanol, and America’s energy dominance with their anti-ag, anti-ethanol, and anti-energy agenda. “We are deeply thankful for the thousands of Iowans who spoke up, making their voices heard and letting Governor Reynolds know their economic future depended on this veto.

“Farmers and ethanol producers deserve thriving, open markets, not activist government that changes the rules in the middle of the game. Governor Reynolds’ steadfast leadership protects their ability to compete in the global demand for low-carbon ethanol and sustainable aviation fuel, fueling prosperity across Iowa’s rural communities.

“By rejecting HF 639, Gov. Reynolds is safeguarding the livelihoods of hardworking farmers and ethanol producers while advancing President Trump’s America First energy agenda. Governor Reynolds’ tireless commitment to agriculture and ethanol, backed by the passionate support of Iowa’s people, cements the state’s role as a global powerhouse, driving jobs, growth, and opportunity for generations to come.”

POET

POET is the world’s largest producer of biofuel and a global leader in sustainable bioproducts. Founded in 1987 and headquartered in Sioux Falls, South Dakota, POET operates 34 bioprocessing facilities across eight states and employs more than 2,400 team members.

Founder and CEO Jeff Broin published a statement thanking Reynolds and said, “At a time when commodity prices are low, these CO2 investments will expand market access for Iowa corn, biofuels, and bioproducts across the globe, increasing the value of every bushel of corn and every acre of Iowa cropland. This decision will bring benefits to Iowa farmers for generations to come.”

Growth Energy

As the nation’s largest biofuel trade association, Growth Energy is a leading voice in America’s biofuel industry. Members of the association operate and support biomanufacturing facilities at the heart of America’s bioeconomy, delivering a new generation of plant-based energy and climate solutions.

CEO Emily Skor praised Reynolds’ “conviction to stand up for rural jobs and preserve opportunities for future generations of Iowa farmers.”

Skor continued, “Carbon capture allows farmers and producers to accelerate investment in U.S. energy innovation and tap into growing markets around the world. These projects add value to every bushel of corn and provide a vital lifeline to our farmers in uncertain times. We look forward to working with our elected leaders to find a balanced policy solution that allows our industry to remain competitive and protects the billions of additional dollars these projects could deliver for farmers in Iowa and across the heartland.”

Disappointment

Iowa Farmers Union

The Iowa Farmers Union (IFU) is “a grassroots member organization of family farmers and ranchers, advocates, and consumers committed to promoting family agriculture in Iowa,” per its website.

“The veto of HF 639 is a betrayal of family farmer values,” IFU President Aaron Lehman said in a statement. “Eminent domain should never be allowed for private gain. Gov. Reynolds has had years to work with her party leaders to find a way to prioritize the property rights of farmers. This action represents a failure in leadership and a rejection of rural community priorities.

“Iowans have clearly made their opinions known about the pipeline project,” Lehman continued. “Farmers’ rights should not be taken away and given to outside corporations trying to pocket millions of dollars in profits while leaving rural neighborhoods with nothing but lower crop yields, damaged soil health, and less community security.”

Brad Sherman, Iowa Gubernatorial Candidate

Brad Sherman is a Republican running for Iowa Governor following Reynolds decision not to seek re-election in 2026. His campaign website details his staunch opposition to eminent domain saying, “Eminent domain should only be used for necessary public projects or infrastructure for common carriers – and then only when all other options are exhausted. Private property is a fundamental principle that must be sacred in Iowa.”  

Following Reynolds’ veto, Sherman published a statement on his campaign Facebook page: “The 2022 election brought in a strong contingent of Constitutional Conservative Republicans and the 2024 election strengthened that trend. The Iowa House Leadership recognized that shift and worked with it. As a result, the Iowa House, as a body, moved more conservative on many issues including HF639 to protect property rights from unconstitutional eminent domain.

“The recent showdown in the Iowa Senate over the use of eminent domain for private gain has drawn a line between Constitutional Conservative Republicans and Establishment Republicans,” he continued. “Some are claiming the 11 Senators who took a stand against Senate leadership, resulting in the passage of HF639 in the Senate, did damage to the party that could possibly result in a pendulum swing toward Democrats. But I see it differently.

“When the pendulum swings back toward the Democrats, it is because the grassroots get discouraged with status quo politics who refuse to stand strong for conservative values, not because a brave contingent of conservatives push back against the status quo. What happened in the Senate is a reflection of what is taking place in Iowa — Iowa is getting more Conservative!”