Senate File 2130 - Introduced
SENATE FILE
BY KIBBIE, FRAISE, SCHOENJAHN,
WOOD, DEARDEN, HANCOCK,
SENG, COURTNEY, DOTZLER,
DANIELSON, KREIMAN, BOLKCOM,
CONNOLLY, BEALL, STEWART,
RAGAN, HATCH, and DVORSKY
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to motor vehicle fuel by providing for the
2 establishment of standards, providing for tax credits, and
3 providing for applicability and effective dates.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
5 TLSB 5772SS 81
6 da/gg/14
PAG LIN
1 1 DIVISION I
1 2 ESTABLISHMENT OF RENEWABLE FUEL STANDARDS
1 3 Section 1. Section 214A.1, Code 2005, is amended by adding
1 4 the following new subsections:
1 5 NEW SUBSECTION. 0A. "Advertise" means to present a
1 6 commercial message in any medium, including but not limited to
1 7 print, radio, television, sign, display, label, tag, or
1 8 articulation.
1 9 NEW SUBSECTION. 1A. "Dealer" means a wholesale dealer or
1 10 retail dealer.
1 11 NEW SUBSECTION. 1B. "E=85 gasoline" means ethanol blended
1 12 gasoline formulated with a minimum percentage of between
1 13 seventy=five and eighty=five percent by volume of ethanol, if
1 14 the formulation meets the standards provided in section
1 15 214A.2.
1 16 NEW SUBSECTION. 1C. "Ethanol" means ethyl alcohol that is
1 17 denatured as required in 23 C.F.R., pts. 20 and 21, for use as
1 18 an oxygenate in gasoline.
1 19 NEW SUBSECTION. 1D. "Ethanol blended gasoline" means a
1 20 formulation of gasoline which is a liquid petroleum product
1 21 blended with ethanol, if the formulation meets the standards
1 22 provided in section 214A.2.
1 23 NEW SUBSECTION. 1E. "Gasoline" means any liquid product
1 24 prepared, advertised, offered for sale or sold for use as, or
1 25 commonly and commercially used as, motor vehicle fuel for use
1 26 in a spark=ignition, internal combustion engine, and which
1 27 meets the specifications provided in section 214A.2.
1 28 NEW SUBSECTION. 1F. "Metered pump" means a motor vehicle
1 29 fuel pump licensed by the department pursuant to chapter 214.
1 30 NEW SUBSECTION. 5A. "Renewable fuel" means a combustible
1 31 liquid derived from grain starch, oilseed, animal fat, or
1 32 other biomass; or produced from a biogas source, including any
1 33 nonfossilized decaying organic matter which is capable of
1 34 powering machinery, including but not limited to an engine or
1 35 power plant. Renewable fuel includes but is not limited to
2 1 ethanol blended gasoline, biodiesel, or biodiesel blended fuel
2 2 meeting the standards of section 214A.2.
2 3 NEW SUBSECTION. 7A. "Service station" means each
2 4 geographic location in this state where a retail dealer sells
2 5 and dispenses motor vehicle fuel on a retail basis.
2 6 Sec. 2. Section 214A.1, subsections 6 and 8, Code 2005,
2 7 are amended by striking the subsections and inserting in lieu
2 8 thereof the following:
2 9 6. "Retail dealer" means a person who operates a place of
2 10 business where motor vehicle fuel is stored and dispensed from
2 11 a metered pump for sale on a retail basis, including a service
2 12 station or mobile location.
2 13 8. "Wholesale dealer" means a person, other than a retail
2 14 dealer, who operates a place of business where motor vehicle
2 15 fuel is stored and dispensed for sale in this state, including
2 16 a permanent or mobile location.
2 17 Sec. 3. Section 214A.2, subsection 1, Code 2005, is
2 18 amended to read as follows:
2 19 1. The secretary department shall adopt rules pursuant to
2 20 chapter 17A for carrying out this chapter. The rules may
2 21 include, but are not limited to, specifications relating to
2 22 motor vehicle fuel or oxygenate octane enhancers, including
2 23 but not limited to gasoline or renewable fuel such as ethanol
2 24 blended gasoline and its components such as an oxygenate. In
2 25 the interest of uniformity, the secretary department shall
2 26 adopt by reference or otherwise specifications relating to
2 27 tests and standards for motor vehicle fuel or oxygenate octane
2 28 enhancers including renewable fuel, established by the United
2 29 States environmental protection agency or A.S.T.M. (American
2 30 society for testing and materials) international, unless the
2 31 secretary department determines that those specifications are
2 32 inconsistent with this chapter or are not appropriate to the
2 33 conditions which exist in this state.
2 34 Sec. 4. Section 214A.2, subsection 2, Code 2005, is
2 35 amended by striking the subsection, and inserting in lieu
3 1 thereof the following:
3 2 2. For motor vehicle fuel advertised for sale or sold as
3 3 gasoline by a dealer, the motor vehicle fuel must meet
3 4 registration requirements for fuels and fuel additives
3 5 established by the United States environmental protection
3 6 agency including as provided under 42 U.S.C. } 7545.
3 7 a. If the motor vehicle fuel is advertised for sale or
3 8 sold as ethanol blended gasoline, the gasoline must comply
3 9 with departmental standards which to every extent feasible
3 10 shall comply with specifications adopted by A.S.T.M.
3 11 international. For ethanol blended gasoline, all of the
3 12 following shall apply:
3 13 (1) For ethanol blended gasoline other than E=85 gasoline,
3 14 at least ten percent of the gasoline by volume must be
3 15 ethanol.
3 16 (2) For E=85 gasoline, all of the following shall apply:
3 17 (a) From the first day of April until the last day of
3 18 October, at least eighty=five percent of the gasoline by
3 19 volume must be ethanol.
3 20 (b) From the first day of November until the last day of
3 21 March, at least seventy=five percent of the gasoline by volume
3 22 must be ethanol.
3 23 (2) In calculating the percentage of ethanol required for
3 24 the formulation of ethanol blended gasoline fuel, a percentage
3 25 of a denaturant or contaminants permitted in the ethanol
3 26 blended gasoline may be excluded as provided by rules adopted
3 27 by the department.
3 28 b. If the motor vehicle fuel is advertised for sale or
3 29 sold as gasoline other than ethanol blended gasoline, the
3 30 gasoline shall be referred to as high=emission gasoline. The
3 31 gasoline shall be a premium grade unleaded gasoline with an
3 32 octane number of at least ninety according to specifications
3 33 of A.S.T.M. international.
3 34 Sec. 5. Section 214A.2, subsection 3, Code 2005, is
3 35 amended by striking the subsection and inserting in lieu
4 1 thereof the following:
4 2 3. a. Except as provided in paragraph "b", a retail
4 3 dealer shall not advertise for sale, sell, or dispense
4 4 gasoline other than ethanol blended gasoline in this state.
4 5 b. A retail dealer may advertise for sale, sell, or
4 6 dispense gasoline, other than ethanol blended gasoline, in
4 7 this state if both of the following apply:
4 8 (1) The gasoline is used to operate a motor which powers
4 9 any one of the following:
4 10 (a) An aircraft as defined in section 328.1.
4 11 (b) A motor vehicle used exclusively for motor sports,
4 12 including on a raceway, if the motor vehicle cannot operate on
4 13 a highway as provided in chapter 321 or rules adopted by the
4 14 state department of transportation.
4 15 (c) An antique vehicle registered under section 321.115.
4 16 (d) A snowmobile as defined in section 321G.1.
4 17 (e) An all=terrain vehicle as defined in section 321G.1.
4 18 (f) A watercraft as defined in section 462A.2.
4 19 (g) A lawnmower or other implement powered by a small
4 20 motor.
4 21 (2) The retail dealer does not use more than one metered
4 22 pump located at a service station to sell and dispense the
4 23 gasoline.
4 24 Sec. 6. Section 214A.3, Code 2005, is amended to read as
4 25 follows:
4 26 214A.3 FALSE REPRESENTATIONS ADVERTISING.
4 27 1. A person for purposes of selling shall not falsely
4 28 represent do any of the following:
4 29 a. Falsely advertise the quality or kind of any motor
4 30 vehicle fuel or oxygenate octane enhancer or add which may be
4 31 added to motor vehicle fuel.
4 32 b. Falsely advertise that a motor vehicle fuel is a
4 33 renewable fuel. The dealer shall not advertise the sale of
4 34 motor vehicle fuel using the term "ethanol" or "E=85" or use
4 35 any derivative, plural, or compound of any such term unless
5 1 the motor vehicle fuel meets the specifications provided in
5 2 section 214A.2.
5 3 c. Add a coloring matter thereto to motor vehicle fuel for
5 4 the purpose of misleading the public as to its quality.
5 5 2. A retail dealer who advertises the sale of gasoline
5 6 which is not ethanol blended gasoline shall refer to the
5 7 gasoline as high=emission gasoline.
5 8 Sec. 7. Section 214A.8, Code 2005, is amended to read as
5 9 follows:
5 10 214A.8 PROHIBITION.
5 11 A retail or wholesale dealer defined in this chapter shall
5 12 not sell any motor vehicle fuel or oxygenate octane enhancer
5 13 in the state that fails to meet applicable standards and
5 14 specifications set out provided in this chapter.
5 15 Sec. 8. Section 214A.16, Code 2005, is amended to read as
5 16 follows:
5 17 214A.16 NOTICE TO PUBLIC OF BLENDED FUEL == DECAL TYPES OF
5 18 MOTOR VEHICLE FUEL SOLD AT A METERED PUMP.
5 19 1. If motor vehicle fuel containing a renewable fuel is
5 20 sold from a motor vehicle fuel pump metered pump, the metered
5 21 pump shall have affixed a decal identifying the name of the
5 22 renewable fuel. The decal may be different based on the type
5 23 of renewable fuel used. The design and location of the decal
5 24 shall be prescribed by rules adopted by the department. A
5 25 decal identifying a renewable fuel shall be consistent with
5 26 standards adopted pursuant to section 159A.6. The department
5 27 may approve an application to place a decal in a special
5 28 location on a pump or container or use a decal with special
5 29 lettering or colors, if the decal appears clear and
5 30 conspicuous to the consumer. The application shall be made in
5 31 writing pursuant to procedures adopted by the department.
5 32 2. If gasoline other than ethanol blended gasoline is sold
5 33 and dispensed from a metered pump, the metered pump shall have
5 34 affixed a label. The label shall identify the gasoline as
5 35 high=emission gasoline and provide notice that its use is
6 1 restricted to those motor vehicles allowed to operate using
6 2 the gasoline as specified in section 214A.2.
6 3 Sec. 9. Section 214A.19, subsection 1, unnumbered
6 4 paragraph 1, Code 2005, is amended to read as follows:
6 5 The department of natural resources, conditioned upon the
6 6 availability of funds, is authorized to award demonstration
6 7 grants to persons who purchase vehicles which operate on
6 8 alternative fuels, including but not limited to, high blend
6 9 ethanol E=85 gasoline, compressed natural gas, electricity,
6 10 solar energy, or hydrogen. A grant shall be for the purpose
6 11 of conducting research connected with the fuel or the vehicle,
6 12 and not for the purchase of the vehicle itself, except that
6 13 the money may be used for the purchase of the vehicle if all
6 14 of the following conditions are satisfied:
6 15 DIVISION II
6 16 E=85 GASOLINE TAX CREDIT FOR RETAIL DEALERS
6 17 Sec. 10. NEW SECTION. 422.11M E=85 GASOLINE TAX CREDIT.
6 18 1. As used in this section, unless the context otherwise
6 19 requires:
6 20 a. "E=85 gasoline", "metered pump", "retail dealer", and
6 21 "service station" mean the same as defined in section 214A.1.
6 22 b. "Sell" means to sell on a retail basis.
6 23 c. "Tax credit" means an E=85 gasoline tax credit as
6 24 provided in this section.
6 25 2. The taxes imposed under this division, less the credits
6 26 allowed under sections 422.12 and 422.12B, shall be reduced by
6 27 the amount of the E=85 gasoline tax credit for each tax year
6 28 that the taxpayer is eligible to claim under this subsection.
6 29 a. In order to be eligible, all of the following must
6 30 apply:
6 31 (1) The taxpayer is a retail dealer who owns or operates
6 32 at least one service station at which E=85 gasoline is sold
6 33 and dispensed through a metered pump in the tax year in which
6 34 the tax credit is claimed.
6 35 (2) The taxpayer complies with requirements of the
7 1 department established to administer this section.
7 2 b. The tax credit shall be calculated for each service
7 3 station owned or operated by the taxpayer in the tax year in
7 4 which the tax credit is claimed. The amount of the tax credit
7 5 is ten cents multiplied by the total number of gallons of E=85
7 6 gasoline sold and dispensed through all metered pumps located
7 7 at that service station during the tax year.
7 8 3. Any credit in excess of the taxpayer's tax liability
7 9 shall be refunded. In lieu of claiming a refund, the taxpayer
7 10 may elect to have the overpayment shown on the taxpayer's
7 11 final, completed return credited to the tax liability for the
7 12 following tax year.
7 13 4. An individual may claim the tax credit allowed a
7 14 partnership, limited liability company, S corporation, estate,
7 15 or trust electing to have the income taxed directly to the
7 16 individual. The amount claimed by the individual shall be
7 17 based upon the pro rata share of the individual's earnings of
7 18 the partnership, limited liability company, S corporation,
7 19 estate, or trust.
7 20 5. This section is repealed on January 1, 2012.
7 21 Sec. 11. Section 422.33, Code Supplement 2005, is amended
7 22 by adding the following new subsection.
7 23 NEW SUBSECTION. 11A. The taxes imposed under this
7 24 division shall be reduced by an E=85 tax credit for each tax
7 25 year that the taxpayer is eligible to claim the tax credit
7 26 under this subsection.
7 27 a. The taxpayer may claim the E=85 tax credit according to
7 28 the same requirements, for the same amount, and calculated in
7 29 the same manner, as provided for the E=85 gasoline tax credit
7 30 pursuant to section 422.11M.
7 31 b. Any E=85 tax credit which is in excess of the
7 32 taxpayer's tax liability shall be refunded or may be shown on
7 33 the taxpayer's final, completed return credited to the tax
7 34 liability for the following tax year in the same manner as
7 35 provided in section 422.11M.
8 1 c. This subsection is repealed on January 1, 2012.
8 2 Sec. 12.
8 3 1. Section 422.11C, Code 2005, is repealed.
8 4 2. Section 422.33, subsection 11, Code Supplement 2005, is
8 5 amended by striking the subsection.
8 6 Sec. 13. APPLICABILITY DATE. Section 422.11M, as enacted
8 7 in this Act, and section 422.33, subsection 11A, as enacted in
8 8 this Act, apply to tax years beginning on or after January 1,
8 9 2007.
8 10 DIVISION III
8 11 COORDINATING PROVISIONS == GOVERNMENT VEHICLES
8 12 Sec. 14. Section 8A.362, subsection 3, Code 2005, is
8 13 amended to read as follows:
8 14 3. a. The director shall provide for a record system for
8 15 the keeping of records of the total number of miles state=
8 16 owned motor vehicles are driven and the per=mile cost of
8 17 operation of each motor vehicle. Every state officer or
8 18 employee shall keep a record book to be furnished by the
8 19 director in which the officer or employee shall enter all
8 20 purchases of gasoline, lubricating oil, grease, and other
8 21 incidental expense in the operation of the motor vehicle
8 22 assigned to the officer or employee, giving the quantity and
8 23 price of each purchase, including the cost and nature of all
8 24 repairs on the motor vehicle. Each operator of a state=owned
8 25 motor vehicle shall promptly prepare a report at the end of
8 26 each month on forms furnished by the director and forwarded to
8 27 the director, giving the information the director may request
8 28 in the report. Each month the director shall compile the
8 29 costs and mileage of state=owned motor vehicles from the
8 30 reports and keep a cost history for each motor vehicle and the
8 31 costs shall be reduced to a cost=per=mile basis for each motor
8 32 vehicle. The director shall call to the attention of an
8 33 elected official or the head of any state agency to which a
8 34 motor vehicle has been assigned any evidence of the
8 35 mishandling or misuse of a state=owned motor vehicle which is
9 1 called to the director's attention.
9 2 b. A motor vehicle operated under this subsection shall
9 3 not operate on gasoline other than ethanol blended gasoline
9 4 blended with at least ten percent ethanol as defined in
9 5 section 214A.1, unless under emergency circumstances. A
9 6 state=issued credit card used to purchase gasoline shall not
9 7 be valid to purchase gasoline other than ethanol blended
9 8 gasoline blended with at least ten percent ethanol, if
9 9 commercially available. The motor vehicle shall also be
9 10 affixed with a brightly visible sticker which notifies the
9 11 traveling public that the motor vehicle is being operated on
9 12 ethanol blended gasoline blended with ethanol. However, the
9 13 sticker is not required to be affixed to an unmarked vehicle
9 14 used for purposes of providing law enforcement or security.
9 15 Sec. 15. Section 260C.19A, subsection 1, Code 2005, is
9 16 amended to read as follows:
9 17 1. A motor vehicle purchased by or used under the
9 18 direction of the board of directors to provide services to a
9 19 merged area shall not operate on gasoline other than ethanol
9 20 blended gasoline blended with at least ten percent ethanol as
9 21 defined in section 214A.1. The motor vehicle shall also be
9 22 affixed with a brightly visible sticker which notifies the
9 23 traveling public that the motor vehicle is being operated on
9 24 ethanol blended gasoline blended with ethanol. However, the
9 25 sticker is not required to be affixed to an unmarked vehicle
9 26 used for purposes of providing law enforcement or security.
9 27 Sec. 16. Section 262.25A, subsection 2, Code 2005, is
9 28 amended to read as follows:
9 29 2. A motor vehicle purchased by the institutions shall not
9 30 operate on gasoline other than gasoline blended with at least
9 31 ten percent ethanol. A state=issued credit card used to
9 32 purchase gasoline shall not be valid to purchase gasoline
9 33 other than ethanol blended gasoline blended with at least ten
9 34 percent ethanol as defined in section 214A.1. The motor
9 35 vehicle shall also be affixed with a brightly visible sticker
10 1 which notifies the traveling public that the motor vehicle is
10 2 being operated on ethanol blended gasoline blended with
10 3 ethanol. However, the sticker is not required to be affixed
10 4 to an unmarked vehicle used for purposes of providing law
10 5 enforcement or security.
10 6 Sec. 17. Section 279.34, Code 2005, is amended to read as
10 7 follows:
10 8 279.34 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
10 9 BLENDED ETHANOL BLENDED GASOLINE.
10 10 A motor vehicle purchased by or used under the direction of
10 11 the board of directors to provide services to a school
10 12 corporation shall not, on or after January 1, 1993, operate on
10 13 gasoline other than ethanol blended gasoline blended with at
10 14 least ten percent ethanol as defined in section 214A.1. The
10 15 motor vehicle shall also be affixed with a brightly visible
10 16 sticker which notifies the traveling public that the motor
10 17 vehicle is being operated on ethanol blended gasoline blended
10 18 with ethanol. However, the sticker is not required to be
10 19 affixed to an unmarked vehicle used for purposes of providing
10 20 law enforcement or security.
10 21 Sec. 18. Section 307.21, subsection 4, paragraph d, Code
10 22 2005, is amended to read as follows:
10 23 d. A motor vehicle purchased by the administrator shall
10 24 not operate on gasoline other than ethanol blended gasoline
10 25 blended with at least ten percent ethanol as defined in
10 26 section 214A.1. A state=issued credit card used to purchase
10 27 gasoline shall not be valid to purchase gasoline other than
10 28 ethanol blended gasoline blended with at least ten percent
10 29 ethanol. The motor vehicle shall also be affixed with a
10 30 brightly visible sticker which notifies the traveling public
10 31 that the motor vehicle is being operated on ethanol blended
10 32 gasoline blended with ethanol. However, the sticker is not
10 33 required to be affixed to an unmarked vehicle used for
10 34 purposes of providing law enforcement or security.
10 35 Sec. 19. Section 331.908, Code 2005, is amended to read as
11 1 follows:
11 2 331.908 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
11 3 BLENDED ETHANOL BLENDED GASOLINE.
11 4 A motor vehicle purchased or used by a county to provide
11 5 county services shall not, on or after January 1, 1993,
11 6 operate on gasoline other than ethanol blended gasoline
11 7 blended with at least ten percent ethanol as defined in
11 8 section 214A.1. The motor vehicle shall also be affixed with
11 9 a brightly visible sticker which notifies the traveling public
11 10 that the motor vehicle is being operated on ethanol blended
11 11 gasoline blended with ethanol. However, the sticker is not
11 12 required to be affixed to an unmarked vehicle used for
11 13 purposes of providing law enforcement or security.
11 14 Sec. 20. Section 364.20, Code 2005, is amended to read as
11 15 follows:
11 16 364.20 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
11 17 BLENDED ETHANOL BLENDED GASOLINE.
11 18 A motor vehicle purchased or used by a city to provide city
11 19 services shall not, on or after January 1, 1993, operate on
11 20 gasoline other than ethanol blended gasoline blended with at
11 21 least ten percent ethanol as defined in section 214A.1. The
11 22 motor vehicle shall also be affixed with a brightly visible
11 23 sticker which notifies the traveling public that the motor
11 24 vehicle is being operated on ethanol blended gasoline blended
11 25 with ethanol. However, the sticker is not required to be
11 26 affixed to an unmarked vehicle used for purposes of providing
11 27 law enforcement or security.
11 28 Sec. 21. Section 904.312A, subsection 1, Code 2005, is
11 29 amended to read as follows:
11 30 1. A motor vehicle purchased by the department shall not
11 31 operate on gasoline other than ethanol blended gasoline
11 32 blended with at least ten percent ethanol as defined in
11 33 section 214A.1. A state=issued credit card used to purchase
11 34 gasoline shall not be valid to purchase gasoline other than
11 35 ethanol blended gasoline blended with at least ten percent
12 1 ethanol. The motor vehicle shall also be affixed with a
12 2 brightly visible sticker which notifies the traveling public
12 3 that the motor vehicle is being operated on gasoline ethanol
12 4 blended with ethanol gasoline. However, the sticker is not
12 5 required to be affixed to an unmarked vehicle used for
12 6 purposes of providing law enforcement or security.
12 7 DIVISION IV
12 8 COORDINATING PROVISIONS == MISCELLANEOUS
12 9 Sec. 22. Section 15.401, Code Supplement 2005, is amended
12 10 to read as follows:
12 11 15.401 E=85 BLENDED GASOLINE RENEWABLE FUELS.
12 12 1. As used in this section, unless the context otherwise
12 13 requires, "E=85 gasoline" means the same as defined in section
12 14 214A.1.
12 15 2. The department shall provide a cost=share program for
12 16 financial incentives for the installation or conversion of
12 17 infrastructure used by service stations to sell do all of the
12 18 following:
12 19 a. Sell and dispense E=85 blended gasoline and for the
12 20 installation or conversion of.
12 21 b. Install or convert infrastructure required to establish
12 22 on=site and off=site terminal facilities that store biodiesel
12 23 for distribution to service stations.
12 24 3. The department shall provide for an addition of at
12 25 least thirty new or converted E=85 gasoline retail outlets and
12 26 four new or converted on=site or off=site terminal facilities
12 27 with a maximum expenditure of three hundred twenty=five
12 28 thousand dollars per year for the fiscal period beginning July
12 29 1, 2005, and ending June 30, 2008. The department may provide
12 30 for the marketing of these products in conjunction with this
12 31 infrastructure program.
12 32 Sec. 23. Section 159A.2, Code 2005, is amended by adding
12 33 the following new subsections:
12 34 NEW SUBSECTION. 3A. "Department" means the department of
12 35 agriculture and land stewardship.
13 1 NEW SUBSECTION. 3B. "Ethanol blended gasoline" means the
13 2 same as defined in section 214A.1.
13 3 Sec. 24. Section 159A.2, subsection 6, Code 2005, is
13 4 amended by striking the subsection and inserting in lieu
13 5 thereof the following:
13 6 6. "Renewable fuel" means the same as defined in section
13 7 214A.1.
13 8 Sec. 25. Section 159A.2, subsection 8, Code 2005, is
13 9 amended by striking the subsection.
13 10 Sec. 26. Section 159A.3, subsection 3, paragraph a, Code
13 11 2005, is amended to read as follows:
13 12 a. A chief purpose of the office is to further the
13 13 production and consumption of ethanol fuel blended gasoline in
13 14 this state. The office shall be the primary state agency
13 15 charged with the responsibility to promote public consumption
13 16 of ethanol fuel blended gasoline.
13 17 Sec. 27. Section 452A.2, Code Supplement 2005, is amended
13 18 by adding the following new subsection:
13 19 NEW SUBSECTION. 9A. "E=85 gasoline" means the same as
13 20 defined in section 214A.1.
13 21 Sec. 28. Section 452A.2, subsection 11, Code Supplement
13 22 2005, is amended to read as follows:
13 23 11. "Ethanol blended gasoline" means motor fuel containing
13 24 at least ten percent alcohol distilled from cereal grains the
13 25 same as defined in section 214A.1.
13 26 Sec. 29. Section 452A.2, subsection 19, unnumbered
13 27 paragraph 1, Code Supplement 2005, is amended to read as
13 28 follows:
13 29 "Motor fuel" means both motor fuel as defined in section
13 30 214A.1 and includes all of the following:
13 31 Sec. 30. Section 452A.2, subsection 21, Code Supplement
13 32 2005, is amended to read as follows:
13 33 21. "Nonterminal storage facility" means a facility where
13 34 motor fuel or special fuel, other than liquefied petroleum
13 35 gas, is stored that is not supplied by a pipeline or a marine
14 1 vessel. "Nonterminal storage facility" includes a facility
14 2 that manufactures products such as alcohol ethanol as defined
14 3 in section 214A.1, biofuel, blend stocks, or additives which
14 4 may be used as motor fuel or special fuel, other than
14 5 liquefied petroleum gas, for operating motor vehicles or
14 6 aircraft.
14 7 Sec. 31. Section 452A.3, subsection 1B, Code Supplement
14 8 2005, is amended to read as follows:
14 9 1B. An excise tax of seventeen cents is imposed on each
14 10 gallon of E=85 gasoline, which contains at least eighty=five
14 11 percent denatured alcohol by volume from the first day of
14 12 April until the last day of October or seventy percent
14 13 denatured alcohol from the first day of November until the
14 14 last day of March, used for the privilege of operating motor
14 15 vehicles in this state as defined in section 214A.1, subject
14 16 to the determination provided in subsection 1C.
14 17 Sec. 32. Section 452A.6, Code 2005, is amended to read as
14 18 follows:
14 19 452A.6 ETHANOL BLENDED GASOLINE AND OTHER PRODUCTS ==
14 20 BLENDER'S LICENSE.
14 21 1. a. A person other than a supplier, restrictive
14 22 supplier, or importer licensed under this division, who blends
14 23 gasoline with alcohol distilled from cereal grains so that the
14 24 blend contains at least ten percent alcohol distilled from
14 25 cereal grains ethanol as defined in section 214A.1 in order to
14 26 formulate ethanol blended gasoline, shall obtain a blender's
14 27 license.
14 28 b. A person who blends two or more special fuel products
14 29 or sells one hundred percent biofuel shall obtain a blender's
14 30 license.
14 31 2. The A blender's license shall be obtained by following
14 32 the procedure under section 452A.4 and the blender's license
14 33 is subject to the same restrictions as contained in that
14 34 section.
14 35 3. A blender required to obtain a license pursuant to this
15 1 section shall maintain records as required by section 452A.10
15 2 as to motor fuel, alcohol ethanol, ethanol blended gasoline,
15 3 and special fuels.
15 4 DIVISION V
15 5 CHANGE OF TERMS
15 6 Sec. 33. CHANGE OF TERMS.
15 7 1. Sections 159A.3 and 214A.17, Code 2005, are amended by
15 8 striking from the provisions the words "oxygenate octane
15 9 enhancers" and inserting the following: "oxygenates".
15 10 2. Sections 214A.1, 214A.4, 214A.5, 214A.7, 214A.8, and
15 11 214A.10, Code 2005, are amended by striking from the
15 12 provisions the words "oxygenate octane enhancer" and inserting
15 13 the following: "oxygenate".
15 14 DIVISION VI
15 15 EFFECTIVE DATE
15 16 Sec. 34. EFFECTIVE DATE. This Act takes effect on January
15 17 1, 2007.
15 18 EXPLANATION
15 19 BACKGROUND. The general assembly has enacted a number of
15 20 Acts which have promoted the production and consumption of
15 21 ethanol blended gasoline.
15 22 In 1991, the general assembly enacted S.F. 545 (1991 Iowa
15 23 Acts, chapter 254), which requires that state and local
15 24 government vehicles operate using ethanol blended gasoline and
15 25 provides that a state=issued credit card can only be used to
15 26 purchase ethanol blended gasoline. The provisions state that
15 27 ethanol blended gasoline must contain at least 10 percent
15 28 ethanol.
15 29 In 2001, the general assembly enacted H.F. 716 (2001 Iowa
15 30 Acts, chapter 123), which created a tax credit for retail
15 31 dealers of gasoline who sell ethanol blended gasoline
15 32 (containing at least 10 percent alcohol). The tax credit
15 33 applies to both taxpayers filing as individuals under Code
15 34 section 422.11C and businesses under Code section 422.33.
15 35 Specifically, the Act provided a tax credit for a retail
16 1 dealer who operates at least one service station at which more
16 2 than 60 percent of the total gallons of gasoline sold by the
16 3 retail dealer is ethanol blended gasoline.
16 4 The same Act also amended provisions in Code section 452A.3
16 5 that provide for an excise tax on each gallon of motor fuel
16 6 sold in the state. Under the Act, until June 30, 2007, the
16 7 rates for ethanol blended gasoline and conventional gasoline
16 8 are adjusted each year based on the number of gallons of
16 9 ethanol blended gasoline that are distributed in this state as
16 10 expressed as a percentage of the total number of gallons of
16 11 motor fuel distributed in this state.
16 12 In 2005, the general assembly enacted H.F. 868 (2005 Iowa
16 13 Acts, chapter 150) imposing a special rate of 17 cents on each
16 14 gallon of E=85 gasoline (a blend containing a minimum of
16 15 between 75 and 85 percent alcohol depending on the season) if
16 16 certain conditions were met. The 2005 Act requires the
16 17 department of revenue to compare the amount of moneys actually
16 18 collected using the special 17 cents rate with the amount of
16 19 moneys that would have been collected if the rate were the
16 20 adjusted rate for ethanol blended gasoline. If the difference
16 21 is equal to or greater than $25,000, the tax rate beginning
16 22 the next year is at the adjusted rate.
16 23 DIVISION I == ESTABLISHMENT OF RENEWABLE FUEL STANDARDS AND
16 24 ETHANOL REQUIREMENTS. This division amends Code chapter 214A,
16 25 which provides authority to the department of agriculture and
16 26 land stewardship to regulate the sale of motor vehicle fuel.
16 27 The division amends Code section 214A.1 by adding a number
16 28 of definitions to the chapter, including ethanol blended
16 29 gasoline and E=85 gasoline. It also amends Code section
16 30 214A.2, which provides for different types of gasoline and
16 31 establishes standards or specifications for gasoline. The
16 32 division amends the section to require that ethanol blended
16 33 gasoline contain a blend of at least 10 percent ethanol. It
16 34 designates gasoline with a minimum seasonal blend of between
16 35 75 and 85 percent or more ethanol as E=85 blended gasoline.
17 1 It also provides that gasoline with a mixture of less than 10
17 2 percent ethanol is to be known as high=emission gasoline.
17 3 The division prohibits retail dealers of gasoline from
17 4 selling gasoline other than ethanol blended gasoline, but
17 5 provides a number of exceptions. The prohibition does not
17 6 apply to gasoline used to operate aircraft, or motor vehicles
17 7 involved exclusively in motor sports events. The requirement
17 8 also does not apply to selling gasoline for use in certain
17 9 vehicles such as antique vehicles, snowmobiles, all=terrain
17 10 vehicles, watercraft, and small motors. The division also
17 11 provides that all high=emission gasoline must be premium grade
17 12 unleaded gasoline. The division prohibits a retail dealer
17 13 from using more than one metered pump to dispense high=
17 14 emission gasoline, and the metered pump must be labeled
17 15 notifying the public of its restricted use. Code section
17 16 214A.8 prohibits a retail dealer or wholesale dealer (defined
17 17 in division I as a "dealer") from selling any motor vehicle
17 18 fuel or oxygenate in the state that fails to meet applicable
17 19 standards provided in Code chapter 214A. Code section 214A.11
17 20 provides that any person violating the provisions of the Code
17 21 chapter is guilty of a simple misdemeanor. A simple
17 22 misdemeanor is punishable by confinement for no more than 30
17 23 days or a fine of at least $50, but not more than $500, or by
17 24 both.
17 25 DIVISION II == E=85 GASOLINE TAX CREDIT FOR RETAIL DEALERS.
17 26 This division amends tax credit provisions in Code chapter 422
17 27 to provide that a retail dealer who sells E=85 ethanol blended
17 28 gasoline is eligible to receive a tax credit. The tax credit
17 29 applies to taxpayers filing as individuals or businesses. The
17 30 amount of the tax credit is 10 cents multiplied by the total
17 31 number of gallons of E=85 ethanol blended gasoline sold and
17 32 dispensed through all motor vehicle fuel pumps operated at
17 33 each of the taxpayer's service stations during the tax year.
17 34 The tax credits are not available after December 31, 2011.
17 35 This division eliminates the current tax credit provisions
18 1 which may be claimed by a retail dealer of motor vehicle fuel
18 2 who operates at least one service station at which more than
18 3 60 percent of the total gallons of gasoline sold by the retail
18 4 dealer is ethanol blended gasoline.
18 5 The provisions in division II which provide a tax credit to
18 6 retail dealers selling E=85 gasoline apply to tax years
18 7 beginning on or after January 1, 2007 and are repealed on
18 8 January 1, 2012.
18 9 DIVISION III == COORDINATING PROVISIONS == GOVERNMENT
18 10 VEHICLES. This division amends the provisions that require
18 11 state and local government vehicles that are required to
18 12 operate using ethanol blended gasoline. The division
18 13 standardizes the language and refers to common definitions as
18 14 created in the division amending Code section 214A.1 and
18 15 related standards created in the division amending Code
18 16 section 214A.2.
18 17 DIVISION IV == COORDINATING PROVISIONS == MISCELLANEOUS. A
18 18 number of provisions in the Code refer to alcohol or ethanol
18 19 blended gasoline, including E=85 gasoline. This division
18 20 standardizes the language and refers to common definitions as
18 21 created in the division amending Code section 214A.1 and
18 22 related standards created in the division amending Code
18 23 section 214A.2.
18 24 DIVISION V == CHANGE IN TERMS. This division amends a
18 25 number of provisions by changing the term "oxygenate octane
18 26 enhancer" to "oxygenate" for purposes of consistency in Code
18 27 chapter 214A.
18 28 DIVISION VI == EFFECTIVE DATE. The bill takes effect on
18 29 January 1, 2007.
18 30 LSB 5772SS 81
18 31 da:rj/gg/14.2