House File 452 - Introduced HOUSE FILE 452 BY COMMITTEE ON AGRICULTURE (SUCCESSOR TO HF 293) A BILL FOR An Act relating to a tax credit for the promotion of biodiesel 1 blended fuel, and including effective date and applicability 2 provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1861HV (1) 84 da/rj

H.F. 452 Section 1. Section 422.11P, Code 2011, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 1A. For purposes of this section, biodiesel 3 fuel shall be classified in the same manner as provided in 4 section 214A.2. 5 Sec. 2. Section 422.11P, subsection 2, paragraph a, 6 subparagraph (2), Code 2011, is amended by striking the 7 subparagraph. 8 Sec. 3. Section 422.11P, subsection 2, paragraph b, Code 9 2011, is amended to read as follows: 10 b. The tax credit shall apply to biodiesel blended fuel 11 formulated with a minimum percentage of two percent by volume 12 of biodiesel classified as B-10 or higher , if the formulation 13 biodiesel blended fuel meets the standards provided in 14 requirements for that classification as provided in section 15 214A.2 . 16 Sec. 4. Section 422.11P, subsection 3, Code 2011, is amended 17 to read as follows: 18 3. a. The tax credit shall be calculated separately for 19 each retail motor fuel site operated by the retail dealer. 20 b. The amount of the tax credit is three ten cents 21 multiplied by the total number of gallons of biodiesel blended 22 fuel sold and dispensed by the retail dealer through all motor 23 fuel pumps located at a retail motor fuel site operated by the 24 retail dealer during the retail dealer’s tax year. 25 Sec. 5. Section 422.11P, subsection 6, Code 2011, is amended 26 to read as follows: 27 6. This section is repealed January 1, 2012 2015 . 28 Sec. 6. Section 422.33, subsection 11C, paragraph c, Code 29 2011, is amended by striking the paragraph. 30 Sec. 7. Section 422.33, subsection 11C, paragraph d, Code 31 2011, is amended to read as follows: 32 d. This subsection is repealed on January 1, 2012 2015 . 33 Sec. 8. EFFECTIVE DATE. This Act takes effect January 1, 34 2012. 35 -1- LSB 1861HV (1) 84 da/rj 1/ 3

H.F. 452 Sec. 9. APPLICABILITY DATE. The sections of this Act 1 amending section 422.11P, and section 422.33, subsection 11C, 2 apply to tax years beginning on or after January 1, 2012. 3 Sec. 10. TAX CREDIT AVAILABILITY. Notwithstanding 2006 4 Iowa Acts, chapter 1142, section 49, the following shall apply: 5 1. For a retail dealer who may claim a biodiesel blended 6 fuel tax credit under section 422.11P or 422.33, subsection 7 11C, as amended in this Act, in calendar year 2012 and whose 8 tax year ends before December 31, 2012, the retail dealer may 9 claim the tax credit during the period beginning January 1, 10 2012, and ending on the last day of the retail dealer’s tax 11 year. 12 2. For a retail dealer who may claim a biodiesel blended 13 fuel tax credit under section 422.11P or 422.33, subsection 14 11C, as amended in this Act, in calendar year 2014 and whose 15 tax year ends before December 31, 2014, the retail dealer 16 may continue to claim the tax credit in the retail dealer’s 17 following tax year. In that case, the tax credit shall be 18 calculated in the same manner as provided in section 422.11P 19 or 422.33, subsection 11C, as amended in this Act, for the 20 remaining period beginning on the first day of the retail 21 dealer’s tax year until December 31, 2014. For that remaining 22 period, the tax credit shall be calculated in the same manner 23 as a retail dealer whose tax year began on the previous January 24 1 and who is calculating the tax credit on December 31, 2014. 25 EXPLANATION 26 GENERAL. This bill provides tax credits for the promotion 27 of biodiesel used in the manufacture of motor fuel which 28 is a blend of diesel fuel and biodiesel (biodiesel blended 29 fuel). The tax credit was enacted by the general assembly in 30 2006 as part of H.F. 2754 and applied retroactively to tax 31 years beginning on and after January 1, 2006 (2006 Iowa Acts, 32 ch. 1142). Biodiesel fuel is designated B-xx where “xx” is 33 the volume percent of biodiesel (Code section 214A.2). For 34 example, all biodiesel blended fuel must be classified as B-1 35 -2- LSB 1861HV (1) 84 da/rj 2/ 3

H.F. 452 or higher; meaning at least 1 percent of biodiesel blended fuel 1 by volume must be biodiesel. The provisions of the bill are 2 administered by the department of revenue. 3 A retail dealer who sells and dispenses diesel fuel from a 4 motor fuel pump is eligible for a biodiesel blended fuel tax 5 credit. The tax credit is multiplied by taking a constant rate 6 of 3 cents multiplied by the number of gallons of B-2 or higher 7 sold and dispensed. The tax credit is due to expire on January 8 1, 2012. 9 The bill eliminates an eligibility requirement specifying 10 that the retail dealer must sell and dispense 50 percent or 11 more biodiesel blended fuel during the tax year. It increases 12 the minimum biodiesel classification from B-2 to B-10. It also 13 eliminates a requirement that the tax credit be calculated 14 separately for each motor fuel site. 15 House File 2754 allowed a retail dealer whose tax year began 16 after January 1, 2006, to claim the tax credit for all of 2006, 17 but eliminated the tax credit on December 31, 2012. Similarly, 18 the bill allows the noncalendar year taxpayer to claim the tax 19 credit for all of 2012, but ends the tax credit for all retail 20 dealers on December 31, 2014. 21 -3- LSB 1861HV (1) 84 da/rj 3/ 3