Fuel filter adhesive destroyed by ethanol?

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Some inboard ski boats have a large Fram canister fuel filter that is also used for diesel applications. The filter has two sections, the smaller top section has resin treated paper that repels water, making it a water separating filter.

The element used to be made in the US and costed about $30, the newer ones I've seen are made in Turkey and cost about $15. The part number is CCS 1136.

A neighbor showed me his that deteriorated and sent filter material and the adhesive that secures it to the end cap through the mechanical fuel pump and into the carb. This is the second time this has happened to him.

Some have suggested the deterioration is due to ethanol, and to use Sta-bil all the time to stop the breakdown.

Think ethanol is the problem, and Sta-bil will stop it?
 
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