Text: HF00687 Text: HF00689 Text: HF00600 - HF00699 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. NEW SECTION. 15E.113 BIODIESEL BLENDING 1 2 EQUIPMENT PROGRAM. 1 3 1. The department shall establish a biodiesel blending 1 4 equipment program. The department shall consult with the Iowa 1 5 soybean association in administering the program. The purpose 1 6 of the program is to provide financing to eligible persons 1 7 engaged in the processing of biodiesel fuel as defined in 1 8 section 159A.2. The financial assistance shall be used for 1 9 the acquisition of equipment necessary to blend soybean oil 1 10 with diesel fuel to produce biodiesel fuel according to 1 11 standards promulgated by the department of agriculture and 1 12 land stewardship pursuant to section 214A.2. 1 13 2. A person is eligible to receive financial assistance 1 14 under the biodiesel blending equipment program if all of the 1 15 following apply: 1 16 a. The person is issued a license to blend special fuels 1 17 by the department of revenue and finance, if the person is 1 18 required to be issued the license pursuant to section 452A.6. 1 19 b. The person is an established business engaged in the 1 20 marketing of special fuels. 1 21 c. The person has technical expertise necessary to process 1 22 biodiesel fuel. 1 23 d. The person applies to the department in a manner and 1 24 according to procedures required by the department. 1 25 3. The department may provide financial assistance to an 1 26 eligible person upon review and evaluation of the person's 1 27 application according to procedures adopted by the department. 1 28 Financial assistance shall be in the form of a grant, loan, 1 29 forgivable loan, loan guarantee, cost share, indemnification 1 30 of costs, or any combination of such financing deemed 1 31 appropriate by the department. The department shall not 1 32 approve an application to refinance an existing loan. If 1 33 moneys are repaid to the department pursuant to a loan 1 34 agreement, the moneys shall be deposited into the biodiesel 1 35 fuel promotion fund. 2 1 Sec. 2. NEW SECTION. 15E.113A SOYBEAN OIL PROCESSING FOR 2 2 BLENDING STOCK PROGRAM. 2 3 1. The department shall establish a soybean oil processing 2 4 for blending stock program. The department shall consult with 2 5 the Iowa soybean association in administering the program. 2 6 The purpose of the program is to provide financing to eligible 2 7 persons engaged in the processing of soybean oil into a 2 8 blending stock to be used for the production of biodiesel fuel 2 9 according to standards promulgated by the department of 2 10 agriculture and land stewardship pursuant to section 214A.2. 2 11 This section does not require that a person eligible to 2 12 receive financial assistance obtain a license to blend special 2 13 fuels as required by the department of revenue and finance 2 14 pursuant to section 452A.6. 2 15 2. A person is eligible to receive financial assistance 2 16 under the soybean oil processing for blending stock program if 2 17 all of the following apply: 2 18 a. The person is a business association organized as a 2 19 cooperative association under chapter 499 or 501, or a limited 2 20 liability company organized under chapter 490A. Qualified 2 21 persons as defined in section 10.1 must hold at least fifty- 2 22 one percent of the cooperative association, including fifty- 2 23 one percent of each class of or groups of members' equity. As 2 24 used in this paragraph, "members' equity" includes but is not 2 25 limited to issued shares, including common stock or preferred 2 26 stock, regardless of distributions, and membership interests. 2 27 However, "members' equity" does not include nonvoting 2 28 interests such as nonvoting common stock or nonvoting 2 29 membership interests. A security such as a warrant or option 2 30 that may be converted to voting stock shall be considered 2 31 members' equity. 2 32 b. The person demonstrates financial capability and 2 33 technical expertise necessary to processing of soybean oil 2 34 into a blending stock used to produce biodiesel fuel. The 2 35 department may require that the person submit a business plan 3 1 which includes a description of how the financial assistance 3 2 will be used, and a description of how the person expects to 3 3 become profitable. 3 4 c. The person applies to the department according to 3 5 procedures required by the department. 3 6 3. The department may provide for financial assistance to 3 7 an eligible person upon review and evaluation of the person's 3 8 application according to procedures adopted by the department. 3 9 Financial assistance shall be in the form of a grant, loan, 3 10 forgivable loan, loan guarantee, cost share, indemnification 3 11 of costs, or any combination of such financing deemed 3 12 appropriate by the department. The department shall not 3 13 approve an application to refinance an existing loan. If 3 14 moneys are repaid to the department pursuant to a loan 3 15 agreement, the moneys shall be deposited into the biodiesel 3 16 fuel promotion fund. 3 17 Sec. 3. NEW SECTION. 15E.114 BIODIESEL FUEL PROMOTION 3 18 FUND. 3 19 1. A biodiesel fuel promotion fund is created in the state 3 20 treasury under the control of the department. 3 21 2. The biodiesel fuel promotion fund shall include any 3 22 moneys appropriated to the fund by the general assembly, 3 23 payments of interest earned, recaptures of awards, repayments 3 24 of moneys loaned or expended by the biodiesel fuel equipment 3 25 program as provided in section 15E.113, the repossession and 3 26 sale of assets securing a loan made under the program, and any 3 27 other moneys available to and obtained or accepted by the 3 28 department from the federal government or private sources for 3 29 placement in the fund. 3 30 3. The biodiesel fuel promotion fund is composed of two 3 31 accounts, the tax credit account and the financial assistance 3 32 account. 3 33 a. The tax credit account shall be used to support 3 34 biodiesel fuel tax credits as provided in sections 422.11H and 3 35 422.33. 4 1 b. The financial assistance account shall be used to 4 2 support the biodiesel blending equipment program as provided 4 3 in section 15E.113 and the soybean oil processing for blending 4 4 stock program as provided in section 15E.113A. 4 5 4. a. The department shall not use more than two percent 4 6 of all moneys deposited and required to be deposited in the 4 7 fund as calculated on July 1 of each year for departmental 4 8 administrative expenses. In administering the fund, the 4 9 department may contract, sue and be sued, and adopt 4 10 administrative rules necessary to carry out the provisions of 4 11 this section and section 15E.113. However, the department 4 12 shall not in any manner directly or indirectly pledge the 4 13 credit of the state. 4 14 b. Moneys shall not be transferred, used, obligated, 4 15 appropriated, or otherwise encumbered except as provided in 4 16 this section. 4 17 5. a. A taxpayer who may claim a biodiesel fuel tax 4 18 credit as provided in section 422.11H or 422.33 must apply to 4 19 the department by a date designated by the department in 4 20 consultation with the department of revenue and finance. 4 21 After verifying the eligibility of a taxpayer for the tax 4 22 credit, the department shall issue a tax credit certificate to 4 23 the taxpayer to be attached to the taxpayer's tax return. The 4 24 tax credit certificate shall contain the taxpayer's name, 4 25 address, tax identification number, the amount of credit, the 4 26 name of each qualifying business location, and other 4 27 information required by the department of revenue and finance. 4 28 The tax credit certificate, unless rescinded by the 4 29 department, shall be accepted by the department of revenue and 4 30 finance as payment for taxes imposed pursuant to chapter 422, 4 31 division II or division III, subject to any conditions or 4 32 restrictions placed by the department of economic development 4 33 upon the face of the tax credit certificate. 4 34 b. The department shall determine any amount of moneys 4 35 that are to be allocated to support the tax credit account by 5 1 a date determined by the department in consultation with the 5 2 department of revenue and finance. The department shall also 5 3 consult with the department of revenue and finance when making 5 4 the determination. The remaining moneys shall be retained in 5 5 the financial assistance account. 5 6 c. The department shall provide for the allocation of 5 7 moneys deposited into the tax credit account to the general 5 8 fund of the state as required by the department of revenue and 5 9 finance in order to support the biodiesel fuel tax credits for 5 10 each tax year. 5 11 6. Section 8.33 does not apply to any moneys in the fund. 5 12 Notwithstanding section 12C.7, interest earned on moneys in 5 13 the fund shall be credited to the fund. 5 14 7. The fund is subject to an annual audit by the auditor 5 15 of state. Moneys in the fund, which may be subject to 5 16 warrants written by the director of revenue and finance, shall 5 17 be drawn upon the written requisition of the director of the 5 18 department of economic development or an authorized 5 19 representative of the director. 5 20 Sec. 4. Section 159A.2, subsections 6 and 8, Code 2003, 5 21 are amended to read as follows: 5 22 6. "Renewable fuel" means an energy source at least in 5 23 part derived from an organic compound capable of powering 5 24 machinery, including an engine or power plant. A renewable 5 25 fuel includes but is not limited to ethanol-blended or 5 26soydieselbiodiesel fuel. 5 27 8."Soydiesel"Biodiesel fuel" means a fuel which is a 5 28 mixture of diesel fuel and processed soybean oil, if at least 5 29twentytwo percent of the mixed fuel by volume is processed 5 30 soybean oil which meets American society for testing and 5 31 materials standards. 5 32 Sec. 5. Section 159A.3, subsection 3, paragraph b, Code 5 33 2003, is amended to read as follows: 5 34 b. The office shall promote the production and consumption 5 35 ofsoydieselbiodiesel fuel in this state. 6 1 Sec. 6. Section 307.20, subsection 3, paragraph a, Code 6 2 2003, is amended to read as follows: 6 3 a. "Biodiesel fuel" meanssoydiesel fuelthe same as 6 4 defined in section 159A.2. 6 5 Sec. 7. NEW SECTION. 422.11H BIODIESEL FUEL TAX CREDIT. 6 6 1. As used in this section, unless the context otherwise 6 7 requires: 6 8 a. "Biodiesel fuel" means the same as defined in section 6 9 159A.2. 6 10 b. "Bulk sales service" means a retail dealer who sells 6 11 and delivers special fuel to the premises of the final or 6 12 ultimate consumer. 6 13 c. "Business location" means each permanent geographic 6 14 location in this state where a retail dealer operates a 6 15 service station or bulk sales service. 6 16 d. "Metered pump" means a motor vehicle fuel pump licensed 6 17 by the department of agriculture and land stewardship pursuant 6 18 to chapter 214. 6 19 e. "Retail dealer" means a retail dealer as defined in 6 20 section 214A.1. 6 21 f. "Sell" means to sell on a retail basis. 6 22 g. "Service station" means each permanent geographic 6 23 location in this state where a retail dealer sells and 6 24 dispenses special fuel through one or more metered pumps as 6 25 regulated under chapter 214A. 6 26 h. "Special fuel" means special fuel as defined in section 6 27 452A.2. 6 28 i. "Tax credit" means the designated biodiesel fuel tax 6 29 credit as provided in this section. 6 30 2. The taxes imposed under this division, less the credits 6 31 allowed under sections 422.12 and 422.12B, shall be reduced by 6 32 a biodiesel fuel tax credit for each tax year that the 6 33 taxpayer is eligible to claim the tax credit under this 6 34 section. In order to be eligible, all of the following must 6 35 apply: 7 1 a. The taxpayer is a retail dealer. 7 2 b. The taxpayer operates at least one business location at 7 3 which more than five percent of the total gallons of special 7 4 fuel for diesel engines sold and dispensed through metered 7 5 pumps and delivered in bulk by the taxpayer in the tax year is 7 6 biodiesel fuel. 7 7 c. The taxpayer's tax return is attached with a 7 8 certificate issued by the department of economic development 7 9 pursuant to section 15E.114. 7 10 d. The taxpayer complies with requirements of the 7 11 department required to administer this section. 7 12 e. The taxpayer reports information to the department of 7 13 natural resources as provided in section 473.7. 7 14 3. The tax credit shall be calculated separately for each 7 15 business location operated by the taxpayer. The amount of the 7 16 tax credit for each eligible business location is two and one- 7 17 half cents multiplied by the total number of gallons of 7 18 biodiesel fuel sold by the taxpayer operating the business 7 19 location during the tax year that is in excess of five percent 7 20 of all special fuel for diesel engines sold by the taxpayer 7 21 operating the business location during the tax year. 7 22 4. Each tax year the total amount of tax credit claims 7 23 that shall be paid pursuant to this section shall not exceed 7 24 the amount deposited in the tax credit account of the 7 25 biodiesel fuel promotion fund created pursuant to section 7 26 15E.114 on and after November 1 of each year. If the 7 27 department receives applications for tax credits in excess of 7 28 the amount of the tax credit account, the applicants shall 7 29 receive certificates for a prorated amount. 7 30 5. Any credit in excess of the taxpayer's tax liability 7 31 shall be refunded. In lieu of claiming a refund, the taxpayer 7 32 may elect to have the overpayment shown on the taxpayer's 7 33 final, completed return credited to the tax liability for the 7 34 following tax year. 7 35 6. An individual may claim the tax credit allowed a 8 1 partnership, limited liability company, S corporation, estate, 8 2 or trust electing to have the income taxed directly to the 8 3 individual. The amount claimed by the individual shall be 8 4 based upon the pro rata share of the individual's earnings of 8 5 a partnership, limited liability company, S corporation, 8 6 estate, or trust. 8 7 Sec. 8. Section 422.33, Code 2003, is amended by adding 8 8 the following new subsection: 8 9 NEW SUBSECTION. 14. a. As used in this subsection, 8 10 unless the context otherwise requires: 8 11 (1) "Biodiesel fuel", "bulk sales service", "business 8 12 location", "metered pump", "retail dealer", "sell", "service 8 13 station", and "special fuel" mean the same as defined in 8 14 section 422.11H. 8 15 (2) "Tax credit" means the designated biodiesel fuel tax 8 16 credit as provided in this subsection. 8 17 b. The taxes imposed under this division shall be reduced 8 18 by a biodiesel fuel tax credit for each tax year that the 8 19 taxpayer is eligible to claim the tax credit under this 8 20 subsection. In order to be eligible, all of the following 8 21 must apply: 8 22 (1) The taxpayer is a retail dealer. 8 23 (2) The taxpayer operates at least one business location 8 24 at which more than five percent of the total gallons of 8 25 special fuel for diesel engines sold and dispensed through 8 26 metered pumps and delivered in bulk by the taxpayer in the tax 8 27 year is biodiesel fuel. 8 28 (3) The taxpayer's tax return is attached with a 8 29 certificate issued by the department of economic development 8 30 pursuant to section 15E.114. 8 31 (4) The taxpayer complies with requirements of the 8 32 department required to administer this subsection. 8 33 (5) The taxpayer reports information to the department of 8 34 natural resources as provided in section 473.7. 8 35 c. The tax credit shall be calculated separately for each 9 1 business location operated by the taxpayer. The amount of the 9 2 tax credit for each eligible business location is two and one- 9 3 half cents multiplied by the total number of gallons of 9 4 biodiesel fuel sold by the taxpayer operating the business 9 5 location during the tax year that is in excess of five percent 9 6 of all special fuel for diesel engines sold by the taxpayer 9 7 operating the business location during the tax year. 9 8 d. Each tax year the total amount of tax credit refund 9 9 claims that shall be paid pursuant to this subsection shall 9 10 not exceed the amount deposited in the tax credit account of 9 11 the biodiesel fuel promotion fund created pursuant to section 9 12 15E.114. If the department receives applications for tax 9 13 credits in excess of the amount in the tax credit account, the 9 14 applicants shall receive certificates for a prorated amount. 9 15 e. Any credit in excess of the taxpayer's tax liability 9 16 shall be refunded. In lieu of claiming a refund, the taxpayer 9 17 may elect to have the overpayment shown on the taxpayer's 9 18 final, completed return credited to the tax liability for the 9 19 following tax year. 9 20 Sec. 9. Section 473.7, Code 2003, is amended by adding the 9 21 following new subsection: 9 22 NEW SUBSECTION. 14A. Obtain information from retail 9 23 dealers as defined in section 422.11H and maintain records 9 24 regarding the market share and gallons purchased of special 9 25 fuels for diesel engines and biodiesel fuel as provided in 9 26 section 422.11H. 9 27 Sec. 10. APPLICABILITY. The biodiesel fuel tax credits 9 28 provided in sections 422.11H and 422.33 apply to tax years 9 29 beginning on or after January 1, 2004. The department of 9 30 revenue and finance shall perform functions, prior to the 9 31 beginning of that tax year, necessary in order to implement 9 32 the tax credits. 9 33 EXPLANATION 9 34 This bill provides for the promotion of biodiesel fuel 9 35 which is a mixture of diesel fuel and processed soybean oil. 10 1 The bill changes the term "soydiesel" fuel to "biodiesel" fuel 10 2 in Code chapter 159A providing for renewable fuels. Diesel 10 3 fuel, including biodiesel fuel, is defined as a "special fuel" 10 4 by the department of revenue and finance. 10 5 The bill establishes several programs within the department 10 6 of economic development. One program establishes a biodiesel 10 7 blending equipment program which provides financing to persons 10 8 for the acquisition of equipment necessary to blend soybean 10 9 oil with diesel fuel to produce biodiesel fuel. Another 10 10 program provides financing to persons who are engaged in the 10 11 processing of soybean oil into a blending stock to be used for 10 12 the ultimate production of biodiesel fuel. 10 13 The bill creates a biodiesel fuel promotion fund 10 14 administered by the department. The fund is split into two 10 15 accounts, including a financial assistance account which is 10 16 used to support the two programs, and a tax credit account 10 17 which is used to support biodiesel fuel tax credits. 10 18 The tax credits are patterned after the ethanol-blended 10 19 gasoline tax credit provisions creating a tax credit for 10 20 retail dealers of motor vehicle fuel who sell ethanol-blended 10 21 gasoline (gasoline containing at least 10 percent alcohol). 10 22 The ethanol-blended gasoline tax credit applies to both 10 23 taxpayers filing as individuals under Code chapter 422, 10 24 division II, and businesses under Code chapter 422, division 10 25 III. Under the bill, a retail dealer of biodiesel fuel may 10 26 claim the tax credit if the retail dealer operates a service 10 27 station or operates a bulk sales service. The bill provides 10 28 that the retail dealer must operate at least one business 10 29 location at which more than 5 percent of the total gallons of 10 30 special fuel for diesel engines sold is biodiesel fuel. 10 31 According to the bill, the amount of the tax credit for each 10 32 eligible service station is two and one-half cents multiplied 10 33 by the total number of gallons of biodiesel fuel sold at that 10 34 service station during the tax year in excess of 5 percent of 10 35 all special fuel for diesel engines sold at that business 11 1 location. The amount of the tax credit for each business 11 2 location is two and one-half cents multiplied by the total 11 3 number of gallons of biodiesel fuel sold by the retail dealer 11 4 operating the business location during the tax year that is in 11 5 excess of 5 percent of all special fuel for diesel engines 11 6 sold by the taxpayer operating the business location during 11 7 the tax year. The total amount of the tax credits cannot 11 8 exceed the amount in the tax credit account, and the amount 11 9 must be prorated if sufficient moneys are not available to pay 11 10 all claims. The tax credits apply to tax years beginning on 11 11 or after January 1, 2004. 11 12 LSB 2736HZ 80 11 13 da/pj/5
Text: HF00687 Text: HF00689 Text: HF00600 - HF00699 Text: HF Index Bills and Amendments: General Index Bill History: General Index
© 2003 Cornell College and League of Women Voters of Iowa
Comments about this site or page?
webmaster@legis.iowa.gov.
Please remember that the person listed above does not vote on bills. Direct all comments concerning legislation to State Legislators.
Last update: Tue May 13 02:30:18 CDT 2003
URL: /DOCS/GA/80GA/Legislation/HF/00600/HF00688/030421.html
jhf