HF 376 (LSB 2132YH (3) 85)

HOUSE FILE 376

BY  S. OLSON

A BILL FOR

An Act providing for the blending of gasoline or diesel fuel by dealers or distributors, and including penalties.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 452A.2, Code 2013, is amended by adding the following new subsection:
   NEW SUBSECTION.  9A.  “Diesel fuel” or “diesel” means diesel fuel as defined in section 214A.1.
    Sec. 2.  NEW SECTION.  452A.6A  Right of distributors and dealers to blend gasoline or diesel fuel using a biofuel.
   1.
  a.  A dealer or distributor may blend gasoline or diesel fuel using the appropriate biofuel on any premises in this state notwithstanding any contrary agreement pursuant to which a terminal operator, terminal owner, or supplier is a party and the distributor or dealer is the other party.
   b.  Paragraph “a” does not apply to the extent that the use of the premises is restricted by federal, state, or local law, or otherwise by a person holding a legal or equitable interest in the premises.
   2.  A terminal operator, terminal owner, or supplier who in the ordinary course of business sells or transports gasoline or diesel fuel which is unblended or blended with a biofuel shall not refuse to sell or transport unblended gasoline or unblended diesel fuel to a distributor or dealer based on the distributor’s or dealer’s intent to blend the gasoline or diesel fuel with a biofuel.
   3.  A terminal operator, terminal owner, or supplier shall not prevent or inhibit a distributor or dealer from being a blender or from qualifying for any federal or state tax credit offered to blenders.
   4.  This section shall not be construed to do any of the following:
   a.  Prohibit a distributor or dealer from purchasing, selling, or transporting gasoline or diesel fuel that has not been blended with a biofuel.
   b.  Affect the blender’s license requirements under section 452A.6.
   5.  A terminal operator, terminal owner, or supplier who violates this section is subject to a civil penalty of not more than ten thousand dollars per violation. Each day that a violation continues is deemed a separate offense.
EXPLANATION
   Motor fuel (e.g., gasoline) and special fuel (e.g., diesel fuel) move into this state via a pipeline or marine vessel to a terminal where in turn the fuel is withdrawn by a supplier and then purchased and transported by a distributor and ultimately a dealer who sells the fuel at retail. During this process, gasoline may be blended with alcohol (ethanol) and diesel fuel may be blended with soybean oil (biodiesel) at a nonterminal location by a person referred to as a blender. Both ethanol and biodiesel are referred to as biofuel (Code sections 214A.1 and 452A.2).
   This bill provides that a terminal operator or owner or a supplier cannot restrict the sale and movement of gasoline or diesel fuel only because the fuel is unblended or inhibit a distributor or dealer from being a blender or qualifying for any federal or state tax credit offered to blenders. A terminal operator or owner or a supplier who violates the bill is subject to a civil penalty of not more than $10,000 per violation.