Senate File 2184 - Introduced
SENATE FILE
BY COMMITTEE ON NATURAL RESOURCES
AND ENVIRONMENT
(SUCCESSOR TO SSB 3054)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to renewable fuel, including ethanol blended fuel
2 and biodiesel blended fuel, providing for tax credits,
3 providing for appropriations, providing penalties, and
4 providing an effective date.
5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
6 TLSB 6142SV 81
7 da/je/5
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. "Biodiesel" means a combustible
1 10 liquid comprised of mono=alkyl esters of long chain fatty
1 11 acids which is all of the following:
1 12 a. A renewable fuel that is a motor fuel capable of
1 13 powering diesel engines or aircraft engines.
1 14 b. Processed from natural oils or fats derived from crops
1 15 such as soybeans, vegetables, or animals.
1 16 NEW SUBSECTION. 1B. "Biodiesel blended fuel" means a
1 17 formulation of diesel fuel which is a liquid petroleum product
1 18 blended with biodiesel.
1 19 NEW SUBSECTION. 1C. "Business association" means the same
1 20 as defined in section 202B.102.
1 21 NEW SUBSECTION. 1D. "Committee" means the renewable fuels
1 22 and coproducts advisory committee established pursuant to
1 23 section 159A.4.
1 24 NEW SUBSECTION. 1E. "Dealer" means a wholesale dealer or
1 25 retail dealer.
1 26 NEW SUBSECTION. 1F. "Diesel fuel" means any liquid
1 27 product prepared, advertised, offered for sale or sold for use
1 28 as, or commonly and commercially used as, motor fuel for use
1 29 in an internal combustion engine and ignited by pressure
1 30 without the presence of an electric spark.
1 31 NEW SUBSECTION. 1G. "E=85 gasoline" means ethanol blended
1 32 gasoline formulated with a minimum percentage of between
1 33 seventy=five and eighty=five percent by volume of ethanol, if
1 34 the formulation meets the standards provided in section
1 35 214A.2.
2 1 NEW SUBSECTION. 1H. "Ethanol" means ethyl alcohol that is
2 2 denatured as required in 23 C.F.R., pts. 20 and 21, for use as
2 3 an oxygenate in gasoline.
2 4 NEW SUBSECTION. 1I. "Ethanol blended gasoline" means a
2 5 formulation of gasoline which is a liquid petroleum product
2 6 blended with ethanol, if the formulation meets the standards
2 7 provided in section 214A.2.
2 8 NEW SUBSECTION. 1J. "Gasoline" means any liquid product
2 9 prepared, advertised, offered for sale or sold for use as, or
2 10 commonly and commercially used as, motor vehicle fuel for use
2 11 in a spark=ignition, internal combustion engine, and which
2 12 meets the specifications provided in section 214A.2.
2 13 NEW SUBSECTION. 1K. "Motor fuel pump" means the same as
2 14 defined in section 214.1.
2 15 NEW SUBSECTION. 1L. "Motor fuel retail business" or
2 16 "business" means a person who is a retail dealer or who
2 17 exercises control over the management decisions of a retail
2 18 dealer, including any business association, which owns or
2 19 controls one or more service stations.
2 20 NEW SUBSECTION. 5A. "Renewable fuel" means a combustable
2 21 liquid derived from grain starch, oilseed, animal fat, or
2 22 other biomass; or produced from a biogas source, including any
2 23 nonfosilized decaying organic matter which is capable of
2 24 powering machinery, including but not limited to an engine or
2 25 power plant. Renewable fuel includes but is not limited to
2 26 ethanol blended gasoline, biodiesel, or biodiesel blended fuel
2 27 meeting the standards of section 214A.2.
2 28 NEW SUBSECTION. 7A. "Service station" means each
2 29 geographic location in this state where a retail dealer sells
2 30 and dispenses motor fuel on a retail basis.
2 31 Sec. 2. Section 214A.1, subsection 2, Code 2005, is
2 32 amended to read as follows:
2 33 2. "Motor vehicle fuel" means a substance or combination
2 34 of substances which is intended to be or is capable of being
2 35 used for the purpose of propelling or running by combustion
3 1 any of operating an internal combustion engine, including but
3 2 not limited to a motor vehicle, and is kept for sale or sold
3 3 for that purpose. The products commonly known as kerosene and
3 4 distillate or petroleum products of lower gravity (Baume
3 5 scale), when not used to propel a motor vehicle or for
3 6 compounding or combining with a motor vehicle fuel, are exempt
3 7 from this chapter except as provided in section 214A.2A.
3 8 Sec. 3. Section 214A.1, subsections 6 and 8, Code 2005,
3 9 are amended by striking the subsections and inserting in lieu
3 10 thereof the following:
3 11 6. "Retail dealer" means a person who operates a place of
3 12 business where motor fuel is stored and dispensed from a motor
3 13 fuel pump for sale on a retail basis, including a service
3 14 station or mobile location.
3 15 8. "Wholesale dealer" means a person, other than a retail
3 16 dealer, who operates a place of business where motor fuel is
3 17 stored and dispensed for sale in this state, including a
3 18 permanent or mobile location.
3 19 Sec. 4. NEW SECTION. 214A.1A MOTOR FUEL QUALITY
3 20 ASSURANCE SCHEDULE.
3 21 1. The department shall adopt a schedule which provides a
3 22 schedule of departmental improvements required for each fiscal
3 23 year necessary to assure that motor fuel sold and dispensed
3 24 from motor fuel pumps in this state meets all applicable
3 25 standards as provided in section 214A.2. On or before June 1
3 26 of each year, and based on the schedule of improvements, the
3 27 secretary of agriculture shall certify the amount required to
3 28 implement the improvements required for the next fiscal year
3 29 to the director of the department of management and the fiscal
3 30 services division of the legislative services agency. The
3 31 department of management shall conduct a review of the
3 32 scheduled improvements for that fiscal year and may reduce the
3 33 amount certified by the secretary if the department of
3 34 management determines that a lesser amount is adequate. The
3 35 director of the department of management and the secretary
4 1 shall report their findings to the legislative government
4 2 oversight committees as required by the committees'
4 3 chairpersons.
4 4 2. For each fiscal year, of the moneys appropriated to
4 5 each state agency to support the production or use of ethanol,
4 6 ethanol blended gasoline, biodiesel, or biodiesel blended fuel
4 7 as defined in section 214A.1, the department of management
4 8 shall transfer a prorated share of the state agency's
4 9 appropriation as is necessary to satisfy the amount required
4 10 to comply with the schedule of improvements for that fiscal
4 11 year as directed by the department of management. The
4 12 department of management shall identify each affected
4 13 appropriation and notify each head of a department of the
4 14 transfer of the prorated share on or before June 15 of each
4 15 year.
4 16 Sec. 5. NEW SECTION. 214A.1B QUALITY ASSURANCE FOR
4 17 BIODIESEL PRODUCTION.
4 18 A biodiesel producer who produces biodiesel for use as a
4 19 motor fuel or as a component of a motor fuel shall not sell
4 20 biodiesel or biodiesel blended fuel in this state, and a
4 21 dealer shall not purchase biodiesel or biodiesel blended fuel
4 22 from a biodiesel producer, unless the biodiesel is certified
4 23 as follows:
4 24 1. A biodiesel producer may be certified pursuant to a
4 25 quality assurance program for biodiesel producers. The
4 26 department, in consultation with the committee, shall
4 27 prescribe audit standards as part of the program. The
4 28 department shall perform a formal review and audit of the
4 29 capacity and commitment of the biodiesel producer to produce
4 30 or market biodiesel or biodiesel blended fuel in a manner and
4 31 according to procedures that meet the program standards for
4 32 quality, including A.S.T.M. international specifications and
4 33 requirements for the storage, sampling, testing, blending,
4 34 shipping, and distribution of biodiesel and biodiesel blended
4 35 fuel as established by the department. The department shall
5 1 certify a biodiesel producer that complies with program
5 2 requirements.
5 3 2. A biodiesel producer may be certified by a designated
5 4 fuel testing facility as selected by the department. A
5 5 biodiesel producer must submit a representative, random sample
5 6 of biodiesel on a quarterly basis to the designated fuel
5 7 testing facility. A new biodiesel producer must submit a
5 8 sample within the first quarter of commercial production for
5 9 testing and certification. However, the new biodiesel
5 10 producer is exempted from the certification requirement until
5 11 the first quarter testing and certification is complete. The
5 12 testing facility shall determine if the biodiesel meets the
5 13 department's standards for quality. If the biodiesel sample
5 14 conforms to the department's standards, the department shall
5 15 certify the biodiesel producer. The designated fuel testing
5 16 facility shall notify the department of the determination as
5 17 required by the department.
5 18 Sec. 6. Section 214A.2, subsection 1, Code 2005, is
5 19 amended to read as follows:
5 20 1. The secretary department shall adopt rules pursuant to
5 21 chapter 17A for carrying out this chapter. The rules may
5 22 include, but are not limited to, specifications relating to
5 23 motor fuel or oxygenate octane enhancers, including but not
5 24 limited to gasoline or renewable fuel such as ethanol blended
5 25 gasoline and its components such as an oxygenate or other
5 26 additive. In the interest of uniformity, the secretary
5 27 department shall adopt by reference or otherwise
5 28 specifications relating to tests and standards for motor fuel
5 29 or oxygenate octane enhancers including renewable fuel,
5 30 established by the United States environmental protection
5 31 agency or A.S.T.M. (American society for testing and
5 32 materials) international, unless the secretary department
5 33 determines that those specifications are inconsistent with
5 34 this chapter or are not appropriate to the conditions which
5 35 exist in this state. The department shall consult with the
6 1 committee when establishing the standards.
6 2 Sec. 7. Section 214A.2, Code 2005, is amended by adding
6 3 the following new subsection:
6 4 NEW SUBSECTION. 2A. a. For motor fuel advertised for
6 5 sale or sold as gasoline by a dealer, the motor fuel must meet
6 6 registration requirements for fuels and fuel additives
6 7 established by the United States environmental protection
6 8 agency including as provided under 42 U.S.C. } 7545.
6 9 b. If the motor fuel is advertised for sale or sold as
6 10 ethanol blended gasoline, the gasoline must comply with
6 11 departmental standards which to every extent feasible shall
6 12 comply with specifications adopted by A.S.T.M. international.
6 13 For ethanol blended gasoline, all of the following shall
6 14 apply:
6 15 (1) For ethanol blended gasoline other than E=85 gasoline,
6 16 at least ten percent of the gasoline by volume must be
6 17 ethanol.
6 18 (2) For E=85 gasoline all of the following must apply:
6 19 (a) From the first day of April until the last day of
6 20 October, at least eighty=five percent of the gasoline by
6 21 volume must be ethanol.
6 22 (b) From the first day of November until the last day of
6 23 March, at least seventy=five percent of the gasoline by volume
6 24 must be ethanol.
6 25 (3) In calculating the percentage of ethanol required for
6 26 the formulation of ethanol blended gasoline fuel, a percentage
6 27 of a denaturant or contaminants permitted in the ethanol
6 28 blended gasoline may be excluded as provided by rules adopted
6 29 by the department.
6 30 Sec. 8. Section 214A.2, subsection 3, Code 2005, is
6 31 amended by striking the subsection.
6 32 Sec. 9. Section 214A.2A, Code 2005, is amended to read as
6 33 follows:
6 34 214A.2A KEROSENE LABELING.
6 35 1. Fuel which is sold or is kept, offered, or exposed for
7 1 sale as kerosene shall be labeled as kerosene. The label
7 2 shall include the word "kerosene" and a designation as either
7 3 "K1" or "K2", and shall indicate that the kerosene is in
7 4 compliance with the standard specification adopted by the
7 5 A.S.T.M. in international specification D=3699 (1982).
7 6 2. A product commonly known as kerosene and distillate or
7 7 a petroleum product of lower gravity (Baume scale), when not
7 8 used to propel a motor vehicle or for compounding or combining
7 9 with a motor fuel, are exempt from this chapter except as
7 10 provided in this section.
7 11 Sec. 10. Section 214A.3, Code 2005, is amended to read as
7 12 follows:
7 13 214A.3 FALSE REPRESENTATIONS ADVERTISING.
7 14 A person for purposes of selling shall not falsely
7 15 represent do any of the following:
7 16 1. Falsely advertise the quality or kind of any motor
7 17 vehicle fuel or oxygenate octane enhancer or add which may be
7 18 added to motor fuel.
7 19 2. Falsely advertise that a motor fuel is a renewable
7 20 fuel. The dealer shall not advertise the sale of motor fuel
7 21 using the term "ethanol", "E=85", or use any derivative,
7 22 plural, or compound of any such word unless the motor vehicle
7 23 fuel meets the standards provided in section 214A.2.
7 24 3. Add a coloring matter thereto to motor fuel for the
7 25 purpose of misleading the public as to its quality.
7 26 SUBCHAPTER 2
7 27 PETROLEUM REPLACEMENT INITIATIVE
7 28 Sec. 11. NEW SECTION. 214A.31 RENEWABLE FUELS SOLD AND
7 29 DISPENSED DURING A DETERMINATION PERIOD.
7 30 For each determination period beginning January 1 and
7 31 ending December 31, the department of revenue shall obtain
7 32 information regarding the distribution of renewable fuels
7 33 dispensed from motor fuel pumps located at service stations in
7 34 this state, including information required to calculate all of
7 35 the following:
8 1 1. The aggregate distribution percentage for a motor fuel
8 2 retail business, which is the total number of gallons of
8 3 ethanol sold and dispensed as a formulation of ethanol blended
8 4 gasoline from motor fuel pumps located at all service stations
8 5 owned or controlled by the motor fuel retail business in this
8 6 state as expressed as a percentage of the total number of
8 7 gallons of gasoline sold and dispensed from all motor fuel
8 8 pumps located at all service stations owned or controlled by
8 9 the motor fuel retail business in this state, which percentage
8 10 is used in determining whether the motor fuel retail business
8 11 meets the threshold as provided in the petroleum replacement
8 12 schedule established pursuant to sections 214A.33 and 214A.34.
8 13 2. The total number of gallons of biodiesel sold and
8 14 dispensed as a formulation of biodiesel blended fuel from
8 15 motor fuel pumps located at all service stations owned or
8 16 controlled by a motor fuel retail business in this state,
8 17 which is used in determining whether the motor fuel retail
8 18 business meets the threshold as provided in the petroleum
8 19 replacement schedule established pursuant to sections 214A.33
8 20 and 214A.34.
8 21 Sec. 12. NEW SECTION. 214A.32 RENEWABLE FUELS SOLD AND
8 22 DISPENSED DURING A DETERMINATION PERIOD == REPORT.
8 23 1. The department of agriculture and land stewardship, in
8 24 cooperation with the committee, and the department of revenue
8 25 shall jointly monitor the progress of each motor fuel retail
8 26 business in meeting the thresholds as provided in the
8 27 petroleum replacement schedule established pursuant to
8 28 sections 214A.33 and 214A.34.
8 29 2. On or before February 1 following a determination
8 30 period, the department of revenue shall send a report which
8 31 compiles the information obtained pursuant to section 214A.31
8 32 to the department of agriculture and land stewardship and the
8 33 fiscal services division of the legislative services agency.
8 34 The report shall state whether the aggregate distribution
8 35 percentage for each motor fuel retail business for the
9 1 determination period meets the threshold required as provided
9 2 in section 214A.33, and if the threshold is not met, the
9 3 amount of additional renewable fuel required to be sold and
9 4 dispensed from all motor fuel pumps located at all service
9 5 stations owned or controlled by each motor fuel retail
9 6 business in order to meet the threshold.
9 7 Sec. 13. NEW SECTION. 214A.33 PETROLEUM REPLACEMENT
9 8 SCHEDULE.
9 9 A petroleum replacement schedule is established based on
9 10 aggregate distribution percentages calculated by the
9 11 department of revenue for each determination period pursuant
9 12 to section 214A.31.
9 13 1. a. For a motor fuel retail business that sells and
9 14 dispenses more than five hundred thousand gallons of gasoline,
9 15 all of the following shall apply:
9 16 (1) For each determination period in the period beginning
9 17 January 1, 2008, and ending December 31, 2009, the threshold
9 18 for the aggregate distribution percentage must be ten percent.
9 19 (2) For each determination period in the period beginning
9 20 January 1, 2010, and ending December 31, 2011, the threshold
9 21 for the aggregate distribution percentage must be fifteen
9 22 percent.
9 23 (3) For each determination period in the period beginning
9 24 January 1, 2012, and ending December 31, 2014, the threshold
9 25 for the aggregate distribution percentage must be twenty
9 26 percent.
9 27 (4) For each determination period beginning on or after
9 28 January 1, 2015, the threshold for the aggregate distribution
9 29 percentage must be twenty=five percent.
9 30 b. If a business does not meet a threshold for a
9 31 determination period as provided in paragraph "a", each gallon
9 32 of biodiesel that is sold and dispensed as a formulation of
9 33 biodiesel blended fuel from motor fuel pumps located at all
9 34 service stations owned or controlled by the motor fuel retail
9 35 business shall be counted as a gallon of ethanol.
10 1 2. a. For a motor fuel retail business that sells and
10 2 dispenses five hundred thousand gallons of gasoline or less,
10 3 all of the following shall apply:
10 4 (1) For each determination period in the period beginning
10 5 January 1, 2010, and ending December 31, 2011, the threshold
10 6 for the aggregate distribution percentage must be ten percent.
10 7 (2) For each determination period in the period beginning
10 8 January 1, 2012, and ending December 31, 2013, the threshold
10 9 for the aggregate distribution percentage must be fifteen
10 10 percent.
10 11 (3) For each determination period in the period beginning
10 12 January 1, 2014, and ending December 31, 2016, the threshold
10 13 for the aggregate distribution percentage must be twenty
10 14 percent.
10 15 (4) For each determination period in the period beginning
10 16 on or after January 1, 2017, the threshold for the aggregate
10 17 distribution percentage must be twenty=five percent.
10 18 b. If a motor fuel retail business does not meet a
10 19 threshold for a determination period as provided in paragraph
10 20 "a", each gallon of biodiesel that is sold and dispensed as a
10 21 formulation of biodiesel blended fuel from motor fuel pumps
10 22 located at all service stations owned or controlled by the
10 23 motor fuel retail business shall be counted as a gallon of
10 24 ethanol.
10 25 Sec. 14. NEW SECTION. 214A.34 PETROLEUM REPLACEMENT
10 26 SCHEDULE == ADJUSTMENT.
10 27 1. A threshold for an aggregate distribution percentage
10 28 for a determination period established in the petroleum
10 29 replacement schedule provided in section 214A.33 shall be
10 30 based on an assumption that a target number of flexible fuel
10 31 vehicles using E=85 gasoline are registered under chapter 321.
10 32 The target numbers of flexible fuel vehicles are as
10 33 follows:
10 34 a. On December 1 of 2010 and 2011, three hundred ninety=
10 35 five thousand.
11 1 b. On December 1 of 2012 through 2014, five hundred fifty
11 2 thousand.
11 3 c. On December 1 of 2015 and each year after that, eight
11 4 hundred twenty=five thousand.
11 5 2. The department of revenue shall adjust a threshold for
11 6 the aggregate distribution percentage for a determination
11 7 period if the department determines that less than the target
11 8 number of flexible fuel vehicles are registered pursuant to
11 9 chapter 321. The department shall calculate the total number
11 10 of gallons of ethanol that would be used if the target number
11 11 of flexible fuel vehicles were registered and adjust the
11 12 threshold for the aggregate distribution percentage
11 13 proportionally to account for the decrease in ethanol use.
11 14 Sec. 15. NEW SECTION. 214A.35 PUBLICATION OF THE
11 15 PETROLEUM REPLACEMENT SCHEDULE THRESHOLD.
11 16 The department shall state the total number of flexible
11 17 fuel vehicles registered on December 1 of each year, whether
11 18 the target number of flexible fuel vehicles have been
11 19 registered as provided in section 214A.34, and the threshold
11 20 for the aggregate distribution percentage for the following
11 21 determination period as provided in section 214A.33. If the
11 22 department of revenue is required to adjust a threshold for
11 23 the aggregate distribution percentage for a determination
11 24 period as provided in section 214A.34, the department shall
11 25 state the adjusted threshold. The statements shall be
11 26 delivered to the administrative code editor by December 10 for
11 27 publication in the next edition of the Iowa administrative
11 28 bulletin.
11 29 Sec. 16. NEW SECTION. 214A.36 FAILURE TO COMPLY WITH
11 30 PETROLEUM REPLACEMENT SCHEDULE == PETROLEUM REPLACEMENT ORDER.
11 31 If at the end of a determination period a motor fuel retail
11 32 business has not met a threshold for the aggregate
11 33 distribution percentage for the determination period as
11 34 published in the Iowa administrative bulletin pursuant to
11 35 section 214A.35, the secretary shall issue an accelerated
12 1 petroleum replacement order after consulting with the
12 2 committee and the department of revenue.
12 3 1. a. The secretary shall deliver the order to each motor
12 4 fuel retail business that fails to meet the threshold.
12 5 b. The secretary shall compile a report listing each motor
12 6 fuel retail business that fails to meet the threshold. The
12 7 report shall be delivered to all of the following:
12 8 (1) The secretary of the senate and the chief clerk of the
12 9 house of representatives.
12 10 (2) The office of attorney general.
12 11 (3) The department of revenue.
12 12 (4) The fiscal services division of the legislative
12 13 services agency.
12 14 c. The accelerated petroleum replacement order shall take
12 15 effect as provided in the order but no later than thirty days
12 16 following the order's issuance.
12 17 d. The secretary may delay issuing the order or may
12 18 suspend the effectiveness of the order for up to twelve months
12 19 if the secretary determines that a shortage in the production
12 20 biomass feedstock will result in a dramatic decrease in
12 21 ethanol inventories.
12 22 2. If the secretary issues a petroleum replacement order,
12 23 all of the following shall apply:
12 24 a. The motor fuel retail business that fails to meet the
12 25 threshold shall be subject to a civil penalty of ten cents for
12 26 each gallon of ethanol required to meet the threshold. The
12 27 civil penalty shall be assessed by the department of
12 28 agriculture and land stewardship and deposited in the general
12 29 fund of the state. The civil penalties shall be deposited in
12 30 the general fund of the state.
12 31 b. The motor fuel retail business that fails to meet the
12 32 threshold, including each motor fuel retail business owned or
12 33 controlled by a retail dealer, shall not be eligible to claim
12 34 an ethanol blended gasoline tax credit as provided in sections
12 35 422.11C or 422.33 for any part of the tax year which is
13 1 subject to the petroleum replacement order.
13 2 c. (1) Except as provided in subparagraph (2), a retail
13 3 dealer that is owned or controlled by a motor fuel retail
13 4 business which fails to meet the threshold shall not advertise
13 5 for sale, sell, or dispense gasoline other than ethanol
13 6 blended gasoline in this state.
13 7 (2) A retail dealer may advertise for sale, sell, or
13 8 dispense gasoline, other than ethanol blended gasoline, in
13 9 this state if both of the following apply:
13 10 (a) The gasoline is used to operate one of the following
13 11 motor vehicles:
13 12 (i) An aircraft as defined in section 328.1.
13 13 (ii) A motor vehicle used exclusively for motor sports,
13 14 including on a raceway, if the motor vehicle cannot operate on
13 15 a highway as provided in chapter 321 or rules adopted by the
13 16 state department of transportation.
13 17 (iii) An antique vehicle registered under section 321.115.
13 18 (iv) A snowmobile as defined in section 321G.1.
13 19 (v) An all=terrain vehicle as defined in section 321G.1.
13 20 (vi) A watercraft as defined in section 462A.2.
13 21 (vii) A small motor such as a lawnmower motor.
13 22 (b) The retail dealer does not use more than one motor
13 23 fuel pump located at a service station to sell and dispense
13 24 the gasoline.
13 25 Sec. 17. Section 422.11C, Code 2005, is amended by adding
13 26 the following new subsection:
13 27 NEW SUBSECTION. 6. A taxpayer shall not be eligible to
13 28 claim the tax credit for any part of the tax year which is
13 29 subject to a petroleum replacement order that applies to the
13 30 retail dealer as provided in section 214A.36.
13 31 Sec. 18. Section 422.33, subsection 11, Code Supplement
13 32 2005, is amended by adding the following new paragraph:
13 33 NEW PARAGRAPH. e. A taxpayer shall not be eligible to
13 34 claim the tax credit for any part of the tax year which is
13 35 subject to a petroleum replacement order that applies to the
14 1 retail dealer as provided in section 214A.36.
14 2 Sec. 19. EFFECTIVE DATE. Section 214A.1A, as enacted in
14 3 this Act, being deemed of immediate importance, takes effect
14 4 upon enactment.
14 5 DIVISION II
14 6 RENEWABLE FUEL TAX CREDIT FOR RETAIL DEALERS
14 7 Sec. 20. Section 422.11C, subsection 1, paragraphs a
14 8 through g, Code 2005, are amended by striking the paragraphs
14 9 and inserting in lieu thereof the following:
14 10 a. "E=85 gasoline", "ethanol blended gasoline",
14 11 "gasoline", "retail dealer", and "service station" mean the
14 12 same as defined in section 214A.1.
14 13 b. "Motor fuel pump" means the same as defined in section
14 14 214.1.
14 15 c. "Sell" means to sell on a retail basis.
14 16 d. "Tax credit" means the designated ethanol blended
14 17 gasoline tax credit as provided in this section.
14 18 Sec. 21. Section 422.11C, subsection 2, paragraph b, Code
14 19 2005, is amended to read as follows:
14 20 b. The taxpayer operates at least one service station at
14 21 which more than sixty percent of the total gallons of gasoline
14 22 sold and dispensed through one or more metered motor fuel
14 23 pumps by the taxpayer in the tax year is ethanol blended
14 24 gasoline.
14 25 Sec. 22. Section 422.11C, subsection 3, Code 2005, is
14 26 amended to read as follows:
14 27 3. a. The tax credit shall be calculated separately for
14 28 each service station site operated by the taxpayer.
14 29 b. The amount of the tax credit for each eligible service
14 30 station is two and one=half cents multiplied by the total
14 31 number of gallons of ethanol blended gasoline sold and
14 32 dispensed through all metered motor fuel pumps located at that
14 33 service station during the tax year in excess of sixty percent
14 34 of all gasoline sold and dispensed through metered motor fuel
14 35 pumps at that service station during the tax year.
15 1 c. The tax credit is not allowed for a gallon of E=85
15 2 gasoline sold and distributed through a motor fuel pump
15 3 located at a service station if the taxpayer claims an E=85
15 4 gasoline tax credit for that same gallon of E=85 gasoline as
15 5 provided in section 422.11M in the same tax year.
15 6 Sec. 23. NEW SECTION. 422.11M E=85 GASOLINE TAX CREDIT.
15 7 1. As used in this section, unless the context otherwise
15 8 requires:
15 9 a. "E=85 gasoline", "retail dealer", and "service station"
15 10 mean the same as defined in section 214A.1.
15 11 b. "Motor fuel pump" means the same as defined in section
15 12 214.1.
15 13 c. "Sell" means to sell on a retail basis.
15 14 d. "Tax credit" means an E=85 gasoline tax credit as
15 15 provided in this section.
15 16 2. The taxes imposed under this division, less the credits
15 17 allowed under sections 422.12 and 422.12B, shall be reduced by
15 18 the amount of the E=85 gasoline tax credit for each tax year
15 19 that the taxpayer is eligible to claim under this section.
15 20 a. In order to be eligible, all of the following must
15 21 apply:
15 22 (1) The taxpayer is a retail dealer who owns or operates
15 23 at least one service station at which E=85 gasoline is sold
15 24 and dispensed through a motor fuel pump in the tax year in
15 25 which the tax credit is claimed.
15 26 (2) The taxpayer complies with requirements of the
15 27 department established to administer this section.
15 28 b. The tax credit shall be calculated for each service
15 29 station owned or operated by the taxpayer in the tax year in
15 30 which the tax credit is claimed. The amount of the tax credit
15 31 is calculated by multiplying a designated rate by the total
15 32 number of gallons of E=85 gasoline sold and dispensed through
15 33 all motor fuel pumps located at that service station during
15 34 the tax year. The designated rate is as follows:
15 35 (1) Ten cents per gallon of E=85 gasoline for each tax
16 1 year of the period beginning January 1, 2007, and ending
16 2 December 31, 2016.
16 3 (2) Five cents per gallon of E=85 gasoline for each tax
16 4 year beginning on or after January 1, 2017.
16 5 3. Any credit in excess of the taxpayer's tax liability
16 6 shall be refunded. In lieu of claiming a refund, the taxpayer
16 7 may elect to have the overpayment shown on the taxpayer's
16 8 final, completed return credited to the tax liability for the
16 9 following tax year.
16 10 4. An individual may claim the tax credit allowed a
16 11 partnership, limited liability company, S corporation, estate,
16 12 or trust electing to have the income taxed directly to the
16 13 individual. The amount claimed by the individual shall be
16 14 based upon the pro rata share of the individual's earnings of
16 15 the partnership, limited liability company, S corporation,
16 16 estate, or trust.
16 17 Sec. 24. NEW SECTION. 422.11N BIODIESEL BLENDED FUEL TAX
16 18 CREDIT.
16 19 1. As used in this section, unless the context otherwise
16 20 requires:
16 21 a. "Biodiesel blended fuel", "diesel fuel", "retail
16 22 dealer", and "service station" mean the same as defined in
16 23 section 214A.1.
16 24 b. "Motor fuel pump" means the same as defined in section
16 25 214.1.
16 26 c. "Sell" means to sell on a retail basis.
16 27 d. "Tax credit" means a biodiesel blended fuel tax credit
16 28 as provided in this section.
16 29 2. The taxes imposed under this division, less the credits
16 30 allowed under sections 422.12 and 422.12B, shall be reduced by
16 31 the amount of the biodiesel blended fuel tax credit for each
16 32 tax year that the taxpayer is eligible to claim under this
16 33 subsection.
16 34 a. In order to be eligible, all of the following must
16 35 apply:
17 1 (1) The taxpayer is a retail dealer who owns or operates
17 2 at least one service station at which biodiesel blended fuel
17 3 is sold and dispensed through a motor fuel pump in the tax
17 4 year in which the tax credit is claimed.
17 5 (2) The taxpayer complies with requirements of the
17 6 department established to administer this section.
17 7 b. The tax credit shall be calculated for each service
17 8 station owned or operated by the taxpayer in the tax year in
17 9 which the tax credit is claimed. The tax credit shall apply
17 10 to biodiesel blended fuel formulated with a minimum percentage
17 11 of two percent by volume of biodiesel, if the formulation
17 12 meets the standards provided in section 214A.2. The amount of
17 13 the tax credit is calculated by multiplying a designated rate
17 14 by the total number of gallons of biodiesel blended fuel sold
17 15 and dispensed through all motor fuel pumps located at that
17 16 service station during the tax year. The designated rate is
17 17 as follows:
17 18 (1) Three cents per gallon of biodiesel for all gallons of
17 19 biodiesel blended fuel which is fifty percent or more but less
17 20 than sixty percent of all diesel fuel sold and dispensed
17 21 through the motor fuel pumps at the service station.
17 22 (2) Four cents per gallon of biodiesel for all gallons of
17 23 biodiesel blended fuel which is sixty percent or more but less
17 24 than seventy percent of all diesel fuel sold and dispensed
17 25 through the motor fuel pumps at the service station.
17 26 (3) Five cents per gallon of biodiesel for all gallons of
17 27 biodiesel blended fuel which is seventy percent or more of all
17 28 diesel fuel sold and dispensed through the motor fuel pumps at
17 29 the service station.
17 30 3. Any credit in excess of the taxpayer's tax liability
17 31 shall be refunded. In lieu of claiming a refund, the taxpayer
17 32 may elect to have the overpayment shown on the taxpayer's
17 33 final, completed return credited to the tax liability for the
17 34 following tax year.
17 35 4. An individual may claim the tax credit allowed a
18 1 partnership, limited liability company, S corporation, estate,
18 2 or trust electing to have the income taxed directly to the
18 3 individual. The amount claimed by the individual shall be
18 4 based upon the pro rata share of the individual's earnings of
18 5 the partnership, limited liability company, S corporation,
18 6 estate, or trust.
18 7 Sec. 25. Section 422.33, subsection 11, paragraph a,
18 8 subparagraph (1), Code Supplement 2005, is amended to read as
18 9 follows:
18 10 (1) "Ethanol "E=85 gasoline", "ethanol blended gasoline",
18 11 "gasoline", "metered pump", "motor fuel pump", "retail
18 12 dealer", "sell", and "service station" mean the same as
18 13 defined in section 422.11C.
18 14 Sec. 26. Section 422.33, subsection 11, paragraph b,
18 15 subparagraph (2), Code Supplement 2005, is amended to read as
18 16 follows:
18 17 (2) The taxpayer operates at least one service station at
18 18 which more than sixty percent of the total gallons of gasoline
18 19 sold and dispensed through one or more metered motor fuel
18 20 pumps by the taxpayer is ethanol blended gasoline.
18 21 Sec. 27. Section 422.33, subsection 11, paragraph c, Code
18 22 Supplement 2005, is amended to read as follows:
18 23 c. (1) The tax credit shall be calculated separately for
18 24 each service station site operated by the taxpayer.
18 25 (2) The amount of the tax credit for each eligible service
18 26 station is two and one=half cents multiplied by the total
18 27 number of gallons of ethanol blended gasoline sold and
18 28 dispensed through all metered motor fuel pumps located at that
18 29 service station during the tax year in excess of sixty percent
18 30 of all gasoline sold and dispensed through metered motor fuel
18 31 pumps at that service station during the tax year.
18 32 (3) The tax credit is not allowed for a gallon of E=85
18 33 gasoline sold and distributed through a motor fuel pump
18 34 located at a service station if the taxpayer claims an E=85
18 35 gasoline tax credit for that same gallon of E=85 gasoline as
19 1 provided in this section in the same tax year.
19 2 Sec. 28. Section 422.33, Code Supplement 2005, is amended
19 3 by adding the following new subsection:
19 4 NEW SUBSECTION. 11A. The taxes imposed under this
19 5 division shall be reduced by an E=85 gasoline tax credit for
19 6 each tax year that the taxpayer is eligible to claim the tax
19 7 credit under this subsection.
19 8 a. The taxpayer may claim the E=85 gasoline tax credit
19 9 according to the same requirements, for the same amount, and
19 10 calculated in the same manner, as provided for the E=85
19 11 gasoline tax credit pursuant to section 422.11M.
19 12 b. Any E=85 gasoline tax credit which is in excess of the
19 13 taxpayer's tax liability shall be refunded or may be shown on
19 14 the taxpayer's final, completed return credited to the tax
19 15 liability for the following tax year in the same manner as
19 16 provided in section 422.11M.
19 17 Sec. 29. Section 422.33, Code Supplement 2005, is amended
19 18 by adding the following new subsection:
19 19 NEW SUBSECTION. 11B. The taxes imposed under this
19 20 division shall be reduced by a biodiesel blended fuel tax
19 21 credit for each tax year that the taxpayer is eligible to
19 22 claim the tax credit under this subsection.
19 23 a. The taxpayer may claim the biodiesel blended fuel tax
19 24 credit according to the same requirements, for the same
19 25 amount, and calculated in the same manner, as provided for the
19 26 biodiesel blended fuel tax credit pursuant to section 422.11N.
19 27 b. Any biodiesel blended fuel tax credit which is in
19 28 excess of the taxpayer's tax liability shall be refunded or
19 29 may be shown on the taxpayer's final, completed return
19 30 credited to the tax liability for the following tax year in
19 31 the same manner as provided in section 422.11N.
19 32 Sec. 30. APPLICABILITY DATE. Sections 422.11M and
19 33 422.11N, as enacted in this Act, and section 422.33,
19 34 subsections 11A and 11B, as enacted in this Act, apply to tax
19 35 years beginning on or after January 1, 2007.
20 1 DIVISION III
20 2 COORDINATING PROVISIONS == GOVERNMENT VEHICLES
20 3 Sec. 31. Section 8A.362, subsection 3, Code 2005, is
20 4 amended to read as follows:
20 5 3. a. The director shall provide for a record system for
20 6 the keeping of records of the total number of miles state=
20 7 owned motor vehicles are driven and the per=mile cost of
20 8 operation of each motor vehicle. Every state officer or
20 9 employee shall keep a record book to be furnished by the
20 10 director in which the officer or employee shall enter all
20 11 purchases of gasoline, lubricating oil, grease, and other
20 12 incidental expense in the operation of the motor vehicle
20 13 assigned to the officer or employee, giving the quantity and
20 14 price of each purchase, including the cost and nature of all
20 15 repairs on the motor vehicle. Each operator of a state=owned
20 16 motor vehicle shall promptly prepare a report at the end of
20 17 each month on forms furnished by the director and forwarded to
20 18 the director, giving the information the director may request
20 19 in the report. Each month the director shall compile the
20 20 costs and mileage of state=owned motor vehicles from the
20 21 reports and keep a cost history for each motor vehicle and the
20 22 costs shall be reduced to a cost=per=mile basis for each motor
20 23 vehicle. The director shall call to the attention of an
20 24 elected official or the head of any state agency to which a
20 25 motor vehicle has been assigned any evidence of the
20 26 mishandling or misuse of a state=owned motor vehicle which is
20 27 called to the director's attention.
20 28 b. A motor vehicle operated under this subsection shall
20 29 not operate on gasoline other than ethanol blended gasoline
20 30 blended with at least ten percent ethanol, unless under
20 31 emergency circumstances. A state=issued credit card used to
20 32 purchase gasoline shall not be valid to purchase gasoline
20 33 other than ethanol blended gasoline blended with at least ten
20 34 percent ethanol as defined in section 214A.1, if commercially
20 35 available. The motor vehicle shall also be affixed with a
21 1 brightly visible sticker which notifies the traveling public
21 2 that the motor vehicle is being operated on ethanol blended
21 3 gasoline blended with ethanol. However, the sticker is not
21 4 required to be affixed to an unmarked vehicle used for
21 5 purposes of providing law enforcement or security.
21 6 Sec. 32. Section 216B.3, subsection 16, paragraph a, Code
21 7 2005, is amended to read as follows:
21 8 a. A motor vehicle purchased by the commission shall not
21 9 operate on gasoline other than ethanol blended gasoline
21 10 blended with at least ten percent ethanol as defined in
21 11 section 214A.1. A state issued credit card used to purchase
21 12 gasoline shall not be valid to purchase gasoline other than
21 13 ethanol blended gasoline blended with at least ten percent
21 14 ethanol. The motor vehicle shall also be affixed with a
21 15 brightly visible sticker which notifies the traveling public
21 16 that the motor vehicle is being operated on ethanol blended
21 17 gasoline blended with ethanol. However, the sticker is not
21 18 required to be affixed to an unmarked vehicle used for
21 19 purposes of providing law enforcement or security.
21 20 Sec. 33. Section 260C.19A, subsection 1, Code 2005, is
21 21 amended to read as follows:
21 22 1. A motor vehicle purchased by or used under the
21 23 direction of the board of directors to provide services to a
21 24 merged area shall not operate on gasoline other than ethanol
21 25 blended gasoline blended with at least ten percent ethanol as
21 26 defined in section 214A.1. The motor vehicle shall also be
21 27 affixed with a brightly visible sticker which notifies the
21 28 traveling public that the motor vehicle is being operated on
21 29 ethanol blended gasoline blended with ethanol. However, the
21 30 sticker is not required to be affixed to an unmarked vehicle
21 31 used for purposes of providing law enforcement or security.
21 32 Sec. 34. Section 262.25A, subsection 2, Code 2005, is
21 33 amended to read as follows:
21 34 2. A motor vehicle purchased by the institutions shall not
21 35 operate on gasoline other than gasoline blended with at least
22 1 ten percent ethanol. A state=issued credit card used to
22 2 purchase gasoline shall not be valid to purchase gasoline
22 3 other than ethanol blended gasoline blended with at least ten
22 4 percent ethanol as defined in section 214A.1. The motor
22 5 vehicle shall also be affixed with a brightly visible sticker
22 6 which notifies the traveling public that the motor vehicle is
22 7 being operated on ethanol blended gasoline blended with
22 8 ethanol. However, the sticker is not required to be affixed
22 9 to an unmarked vehicle used for purposes of providing law
22 10 enforcement or security.
22 11 Sec. 35. Section 279.34, Code 2005, is amended to read as
22 12 follows:
22 13 279.34 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
22 14 BLENDED ETHANOL BLENDED GASOLINE.
22 15 A motor vehicle purchased by or used under the direction of
22 16 the board of directors to provide services to a school
22 17 corporation shall not, on or after January 1, 1993, operate on
22 18 gasoline other than ethanol blended gasoline blended with at
22 19 least ten percent ethanol. The motor vehicle shall also be
22 20 affixed with a brightly visible sticker which notifies the
22 21 traveling public that the motor vehicle is being operated on
22 22 ethanol blended gasoline blended with ethanol. However, the
22 23 sticker is not required to be affixed to an unmarked vehicle
22 24 used for purposes of providing law enforcement or security.
22 25 Sec. 36. Section 307.21, subsection 4, paragraph d, Code
22 26 2005, is amended to read as follows:
22 27 d. A motor vehicle purchased by the administrator shall
22 28 not operate on gasoline other than ethanol blended gasoline
22 29 blended with at least ten percent ethanol as defined in
22 30 section 214A.1. A state=issued credit card used to purchase
22 31 gasoline shall not be valid to purchase gasoline other than
22 32 ethanol blended gasoline blended with at least ten percent
22 33 ethanol. The motor vehicle shall also be affixed with a
22 34 brightly visible sticker which notifies the traveling public
22 35 that the motor vehicle is being operated on ethanol blended
23 1 gasoline blended with ethanol. However, the sticker is not
23 2 required to be affixed to an unmarked vehicle used for
23 3 purposes of providing law enforcement or security.
23 4 Sec. 37. Section 331.908, Code 2005, is amended to read as
23 5 follows:
23 6 331.908 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
23 7 BLENDED ETHANOL BLENDED GASOLINE.
23 8 A motor vehicle purchased or used by a county to provide
23 9 county services shall not, on or after January 1, 1993,
23 10 operate on gasoline other than ethanol blended gasoline
23 11 blended with at least ten percent ethanol. The motor vehicle
23 12 shall also be affixed with a brightly visible sticker which
23 13 notifies the traveling public that the motor vehicle is being
23 14 operated on ethanol blended gasoline blended with ethanol.
23 15 However, the sticker is not required to be affixed to an
23 16 unmarked vehicle used for purposes of providing law
23 17 enforcement or security.
23 18 Sec. 38. Section 364.20, Code 2005, is amended to read as
23 19 follows:
23 20 364.20 MOTOR VEHICLES REQUIRED TO OPERATE ON ETHANOL=
23 21 BLENDED ETHANOL BLENDED GASOLINE.
23 22 A motor vehicle purchased or used by a city to provide city
23 23 services shall not, on or after January 1, 1993, operate on
23 24 gasoline other than ethanol blended gasoline blended with at
23 25 least ten percent ethanol as defined in section 214A.1. The
23 26 motor vehicle shall also be affixed with a brightly visible
23 27 sticker which notifies the traveling public that the motor
23 28 vehicle is being operated on ethanol blended gasoline blended
23 29 with ethanol. However, the sticker is not required to be
23 30 affixed to an unmarked vehicle used for purposes of providing
23 31 law enforcement or security.
23 32 DIVISION IV
23 33 COORDINATING PROVISIONS == MISCELLANEOUS
23 34 Sec. 39. Section 15.401, Code Supplement 2005, is amended
23 35 to read as follows:
24 1 15.401 E=85 BLENDED GASOLINE RENEWABLE FUELS.
24 2 1. As used in this section, unless the context otherwise
24 3 requires, "biodiesel", "biodiesel blended fuel", "E=85
24 4 gasoline", and "service station" mean the same as defined in
24 5 section 214A.1.
24 6 2. The department shall provide a cost=share program for
24 7 financial incentives for the installation or conversion of
24 8 infrastructure used by service stations to do all of the
24 9 following:
24 10 a. sell Sell and dispense E=85 blended gasoline and for
24 11 the installation or conversion of.
24 12 b. Install or convert infrastructure required to establish
24 13 on=site and off=site terminal facilities that store biodiesel
24 14 or biodiesel blended fuel for distribution to service
24 15 stations.
24 16 3. The department shall provide for an addition of at
24 17 least thirty new or converted E=85 gasoline retail outlets and
24 18 four new or converted on=site or off=site terminal facilities
24 19 with a maximum expenditure of three hundred twenty=five
24 20 thousand dollars per year for the fiscal period beginning July
24 21 1, 2005, and ending June 30, 2008. The department may provide
24 22 for the marketing of these products in conjunction with this
24 23 infrastructure program.
24 24 Sec. 40. Section 159A.2, Code 2005, is amended by adding
24 25 the following new subsections:
24 26 NEW SUBSECTION. 0A. "Biodiesel" and "biodiesel blended
24 27 fuel" mean the same as defined in section 214A.1.
24 28 NEW SUBSECTION. 3A. "Department" means the department of
24 29 agriculture and land stewardship.
24 30 NEW SUBSECTION. 3B. "Ethanol blended gasoline" means the
24 31 same as defined in section 214A.1.
24 32 Sec. 41. Section 159A.2, subsection 6, Code 2005, is
24 33 amended by striking the subsection and inserting in lieu
24 34 thereof the following:
24 35 6. "Renewable fuel" means the same as defined in section
25 1 214A.1.
25 2 Sec. 42. Section 159A.2, subsection 8, Code 2005, is
25 3 amended by striking the subsection.
25 4 Sec. 43. Section 159A.3, subsection 3, Code 2005, is
25 5 amended to read as follows:
25 6 3. a. A chief purpose of the office is to further the
25 7 production and consumption of ethanol fuel blended gasoline in
25 8 this state. The office shall be the primary state agency
25 9 charged with the responsibility to promote public consumption
25 10 of ethanol fuel blended gasoline.
25 11 b. The office shall promote the production and consumption
25 12 of soydiesel fuel biodiesel and biodiesel blended fuel in this
25 13 state.
25 14 Sec. 44. Section 214A.19, subsection 1, unnumbered
25 15 paragraph 1, Code 2005, is amended to read as follows:
25 16 The department of natural resources, conditioned upon the
25 17 availability of funds, is authorized to award demonstration
25 18 grants to persons who purchase vehicles which operate on
25 19 alternative fuels, including but not limited to, high blend
25 20 ethanol E=85 gasoline, biodiesel, compressed natural gas,
25 21 electricity, solar energy, or hydrogen. A grant shall be for
25 22 the purpose of conducting research connected with the fuel or
25 23 the vehicle, and not for the purchase of the vehicle itself,
25 24 except that the money may be used for the purchase of the
25 25 vehicle if all of the following conditions are satisfied:
25 26 Sec. 45. Section 307.20, Code 2005, is amended to read as
25 27 follows:
25 28 307.20 BIODIESEL AND BIODIESEL BLENDED FUEL REVOLVING
25 29 FUND.
25 30 1. A biodiesel and biodiesel blended fuel revolving fund
25 31 is created in the state treasury. The biodiesel and biodiesel
25 32 blended fuel revolving fund shall be administered by the
25 33 department and shall consist of moneys received from the sale
25 34 of EPAct credits banked by the department on April 19, 2001,
25 35 moneys appropriated by the general assembly, and any other
26 1 moneys obtained or accepted by the department for deposit in
26 2 the fund. Moneys in the fund are appropriated to and shall be
26 3 used by the department for the purchase of biodiesel and
26 4 biodiesel blended fuel for use in department vehicles. The
26 5 department shall submit an annual report not later than
26 6 January 31 to the members of the general assembly and the
26 7 legislative services agency, of the expenditures made from the
26 8 fund during the preceding fiscal year. Section 8.33 does not
26 9 apply to any moneys in the fund and, notwithstanding section
26 10 12C.7, subsection 2, earnings or interest on moneys deposited
26 11 in the fund shall be credited to the fund.
26 12 2. A department departmental motor vehicle operating on
26 13 using biodiesel or biodiesel blended fuel shall be affixed
26 14 with a brightly visible sticker that notifies the traveling
26 15 public that the motor vehicle uses biodiesel blended fuel.
26 16 3. For purposes of this section the following definitions
26 17 apply:
26 18 a. "Biodiesel "Biodiesel" and "biodiesel blended fuel"
26 19 means soydiesel fuel mean the same as defined in section
26 20 159A.2 214A.1.
26 21 b. "EPAct credit" means a credit issued pursuant to the
26 22 federal Energy Policy Act (EPAct), 42 U.S.C. } 13201 et seq.
26 23 Sec. 46. Section 452A.2, subsection 2, Code Supplement
26 24 2005, is amended by striking the subsection and inserting in
26 25 lieu thereof the following:
26 26 2. "Biodiesel" and "biodiesel blended fuel" mean the same
26 27 as defined in section 214A.1.
26 28 Sec. 47. Section 452A.2, subsection 3, Code Supplement
26 29 2005, is amended to read as follows:
26 30 3. "Blender" means a person who owns and blends alcohol
26 31 ethanol with gasoline to produce ethanol blended gasoline and
26 32 blends the product at a nonterminal location. The blender
26 33 person is not restricted to blending alcohol ethanol with
26 34 gasoline. Products blended with gasoline other than grain
26 35 alcohol ethanol are taxed as gasoline. "Blender" also means a
27 1 person blending two or more special fuel products at a
27 2 nonterminal location where the tax has not been paid on all of
27 3 the products blended. This blend is taxed as a special fuel.
27 4 Sec. 48. Section 452A.2, Code Supplement 2005, is amended
27 5 by adding the following new subsection:
27 6 NEW SUBSECTION. 9A. "E=85 gasoline" means the same as
27 7 defined in section 214A.1.
27 8 Sec. 49. Section 452A.2, subsection 11, Code Supplement
27 9 2005, is amended to read as follows:
27 10 11. "Ethanol blended gasoline" means motor fuel containing
27 11 at least ten percent alcohol distilled from cereal grains the
27 12 same as defined in section 214A.1.
27 13 Sec. 50. Section 452A.2, subsection 19, unnumbered
27 14 paragraph 1, Code Supplement 2005, is amended to read as
27 15 follows:
27 16 "Motor fuel" means both motor fuel as defined in section
27 17 214A.1 and includes all of the following:
27 18 Sec. 51. Section 452A.2, subsection 21, Code Supplement
27 19 2005, is amended to read as follows:
27 20 21. "Nonterminal storage facility" means a facility where
27 21 motor fuel or special fuel, other than liquefied petroleum
27 22 gas, is stored that is not supplied by a pipeline or a marine
27 23 vessel. "Nonterminal storage facility" includes a facility
27 24 that manufactures products such as alcohol ethanol as defined
27 25 in section 214A.1, biofuel, blend stocks, or additives which
27 26 may be used as motor fuel or special fuel, other than
27 27 liquefied petroleum gas, for operating motor vehicles or
27 28 aircraft.
27 29 Sec. 52. Section 452A.3, subsection 1B, Code Supplement
27 30 2005, is amended to read as follows:
27 31 1B. An excise tax of seventeen cents is imposed on each
27 32 gallon of E=85 gasoline, which contains at least eighty=five
27 33 percent denatured alcohol by volume from the first day of
27 34 April until the last day of October or seventy percent
27 35 denatured alcohol from the first day of November until the
28 1 last day of March, used for the privilege of operating motor
28 2 vehicles in this state as defined in section 214A.1, subject
28 3 to the determination provided in subsection 1C.
28 4 Sec. 53. Section 452A.6, Code 2005, is amended to read as
28 5 follows:
28 6 452A.6 ETHANOL BLENDED GASOLINE AND OTHER PRODUCTS ==
28 7 BLENDER'S LICENSE.
28 8 1. a. A person other than a supplier, restrictive
28 9 supplier, or importer licensed under this division, who blends
28 10 gasoline with alcohol distilled from cereal grains so that the
28 11 blend contains at least ten percent alcohol distilled from
28 12 cereal grains ethanol as defined in section 214A.1 in order to
28 13 formulate ethanol blended gasoline, shall obtain a blender's
28 14 license.
28 15 b. A person who blends two or more special fuel products
28 16 or sells one hundred percent biofuel shall obtain a blender's
28 17 license.
28 18 2. The A blender's license shall be obtained by following
28 19 the procedure under section 452A.4 and the blender's license
28 20 is subject to the same restrictions as contained in that
28 21 section.
28 22 3. A blender required to obtain a license pursuant to this
28 23 section shall maintain records as required by section 452A.10
28 24 as to motor fuel, alcohol ethanol, ethanol blended gasoline,
28 25 and special fuels.
28 26 DIVISION V
28 27 CHANGE OF TERMS
28 28 Sec. 54. CHANGE OF TERMS.
28 29 1. Sections 8A.362, 101.21, 159A.4, 214.1, 214.11, 214A.1,
28 30 214A.2, 214A.4, 214A.5, 214A.7, 214A.8, 214A.9, 214A.10,
28 31 214A.16, 214A.17, 214A.18, 306C.11, 312.1, 321.40, 321.56,
28 32 423.14, 452A.63, 452A.66, and 452A.78, Code 2005, are amended
28 33 by striking from the provisions the words "motor vehicle fuel"
28 34 and inserting the following: "motor fuel".
28 35 2. Sections 214.1, 214.3, 214.9, 214.11, and 214A.16, Code
29 1 2005, are amended by striking the words "motor vehicle fuel
29 2 pump" or "motor vehicle fuel pumps" and inserting the
29 3 following: "motor fuel pump" or "motor fuel pumps".
29 4 3. Sections 159A.3 and 214A.17, Code 2005, are amended by
29 5 striking from the provisions the words "oxygenate octane
29 6 enhancers" and inserting the following: "oxygenates".
29 7 4. Sections 214A.1, 214A.4, 214A.5, 214A.7, 214A.8, and
29 8 214A.10, Code 2005, are amended by striking from the
29 9 provisions the words "oxygenate octane enhancer" and inserting
29 10 the following: "oxygenate".
29 11 EXPLANATION
29 12 DIVISION I == ESTABLISHMENT OF RENEWABLE FUEL STANDARDS.
29 13 This division amends Code chapter 214A, which provides
29 14 authority to the department of agriculture and land
29 15 stewardship to regulate the sale of motor fuel.
29 16 The division amends Code section 214A.1 by providing a
29 17 number of definitions for "biodiesel", "biodiesel blended
29 18 fuel", "ethanol", "ethanol blended gasoline", and "E=85
29 19 gasoline". It also amends Code section 214A.2, which provides
29 20 for different types of gasoline and establishes standards or
29 21 specifications for gasoline. The division amends the section
29 22 to require that ethanol blended gasoline contain a blend of at
29 23 least 10 percent ethanol. It designates gasoline with a
29 24 minimum seasonal blend of between 75 and 85 percent or more
29 25 ethanol as E=85 blended gasoline.
29 26 The division provides programs to ensure motor fuel
29 27 quality. The division requires the department to adopt a
29 28 schedule of departmental improvements required for each fiscal
29 29 year necessary to assure that motor fuel meets all applicable
29 30 standards as provided in Code section 214A.2. For each fiscal
29 31 year, the moneys appropriated to each state agency to support
29 32 the production or use of ethanol, ethanol blended gasoline,
29 33 biodiesel, or biodiesel blended fuel, the department of
29 34 management must transfer a prorated share of the state
29 35 agency's appropriation as is necessary to satisfy the amount
30 1 required to comply with the schedule of improvements for that
30 2 fiscal year as certified by the secretary of agriculture
30 3 subject to approval by the department of management.
30 4 The division also provides that a biodiesel producer who
30 5 produces biodiesel fuel for use as a motor fuel or as a
30 6 component of a motor fuel shall not sell biodiesel or
30 7 biodiesel blended fuel in this state, and a dealer shall not
30 8 purchase biodiesel or biodiesel blended fuel from a biodiesel
30 9 producer, unless the biodiesel producer is certified by the
30 10 department or by a fuel testing facility as selected by the
30 11 department.
30 12 The division imposes a number of requirements of businesses
30 13 which own or control service stations operated by retail
30 14 dealers. The requirements are administered and enforced by
30 15 the department of revenue and the department of agriculture
30 16 and land stewardship working in consultation with the
30 17 renewable fuels and coproducts advisory committee.
30 18 The division requires that businesses must sell a certain
30 19 percentage of ethanol within a determination period (beginning
30 20 January 1 and ending December 31). The percentage is referred
30 21 to as a threshold. The division provides a number of
30 22 thresholds which increase periodically according to a
30 23 schedule. The thresholds are delayed for two years for small
30 24 businesses (selling 500,000 gallons or less of gasoline). A
30 25 threshold is based on an assumption that there is a target
30 26 number of state registered flexible fuel vehicles using E=85
30 27 gasoline. The department of revenue may adjust a threshold if
30 28 a target is not met and publish the adjusted threshold in the
30 29 Iowa administrative bulletin.
30 30 If at the end of a determination period, a business has not
30 31 met a threshold, the secretary of agriculture must issue an
30 32 accelerated petroleum replacement order, unless the secretary
30 33 finds a delay or suspension is warranted based on decreased
30 34 ethanol inventories. A business which fails to meet a
30 35 threshold is subject to a civil penalty of 10 cents for each
31 1 one gallon of ethanol required to meet the threshold.
31 2 A dealer who is owned or controlled by such business not
31 3 meeting the threshold is not eligible to claim an ethanol
31 4 blended tax credit. In addition, the retail dealer is
31 5 prohibited from selling gasoline other than ethanol blended
31 6 gasoline, with a number of exceptions. The prohibition does
31 7 not apply to gasoline used to operate aircraft, motor vehicles
31 8 involved exclusively in motor sports events, or motor vehicles
31 9 operating using diesel fuel. The requirement also does not
31 10 apply to selling gasoline for use in certain vehicles such as
31 11 antique vehicles, snowmobiles, all=terrain vehicles,
31 12 watercraft, and small motors.
31 13 DIVISION II == RENEWABLE FUEL TAX CREDIT FOR RETAIL
31 14 DEALERS. This division amends tax credit provisions in Code
31 15 chapter 422 to provide that a retail dealer who sells E=85
31 16 gasoline is eligible to receive a tax credit. The tax credit
31 17 applies to taxpayers filing as individuals or businesses. The
31 18 amount of the tax credit is a designated rate multiplied by
31 19 the total number of gallons of E=85 gasoline sold and
31 20 dispensed through all motor fuel pumps operated at each of the
31 21 taxpayer's service stations during the tax year. The rate
31 22 begins at 10 cents for the first 10 years and is adjusted to 5
31 23 cents after that.
31 24 The division also provides that a retail dealer who sells
31 25 biodiesel blended fuel is also eligible to receive a tax
31 26 credit with similar requirements that apply to a retail dealer
31 27 who sells ethanol blended gasoline. In this case, the amount
31 28 is based on each gallon of biodiesel sold and dispensed by the
31 29 retail dealer and ranges from 3 to 5 cents depending upon the
31 30 percentage of biodiesel blended fuel sold when compared to the
31 31 total amount of diesel fuel sold.
31 32 The provisions which provide a tax credit to retail dealers
31 33 selling E=85 gasoline and biodiesel blended fuel apply to tax
31 34 years beginning on or after January 1, 2007.
31 35 DIVISION III == COORDINATING PROVISIONS == GOVERNMENT
32 1 VEHICLES. This division amends the provisions that require
32 2 state and local government vehicles to operate using ethanol
32 3 blended gasoline. It also amends similar provisions which
32 4 require state agencies to purchase flexible fuel vehicles.
32 5 The division standardizes the language and refers to common
32 6 definitions as created in the division amending Code section
32 7 214A.1 and related standards created in the division amending
32 8 Code section 214A.2.
32 9 DIVISION IV == COORDINATING PROVISIONS == MISCELLANEOUS. A
32 10 number of provisions in the Code refer to alcohol or ethanol
32 11 blended gasoline, including E=85 gasoline, and soydiesel or
32 12 biofuel. This division standardizes the language and refers
32 13 to common definitions as created in the division amending Code
32 14 section 214A.1 and related standards created in the division
32 15 amending Code section 214A.2.
32 16 DIVISION V == CHANGE IN TERMS. This division amends a
32 17 number of provisions by changing the term "oxygenate octane
32 18 enhancer" to "oxygenate", "motor vehicle fuel" to "motor
32 19 fuel", and "motor vehicle fuel pump" to "motor fuel pump" for
32 20 purposes of consistency in chapters throughout the Code, but
32 21 in particular in Code chapters 214A and 452A.
32 22 LSB 6142SV 81
32 23 da:rj/je/5