Senate File 286 - Introduced



                                       SENATE FILE       
                                       BY  BOLKCOM


    Passed Senate, Date               Passed House,  Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act relating to motor vehicle fuel taxes, by exempting small
  2    biofuel producers.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  4 TLSB 2392SS 81
  5 da/sh/8

PAG LIN



  1  1    Section 1.  Section 452A.2, Code 2005, is amended by adding
  1  2 the following new subsection:
  1  3    NEW SUBSECTION.  24A.  "Small biofuel producer" means a
  1  4 natural person who produces a biofuel for use in powering
  1  5 diesel engines, if all of the following apply:
  1  6    1.  The biofuel is used for the person's own use or the use
  1  7 of other natural persons who reside in the household.
  1  8    2.  The person does not produce more than three hundred
  1  9 gallons of biofuel during any year.
  1 10    Sec. 2.  Section 452A.3, Code 2005, is amended by adding
  1 11 the following new subsection:
  1 12    NEW SUBSECTION.  1B.  An excise tax shall not be imposed on
  1 13 a biofuel produced by a small biofuel producer.
  1 14    Sec. 3.  Section 452A.6, Code 2005, is amended to read as
  1 15 follows:
  1 16    452A.6  ETHANOL BLENDED GASOLINE AND OTHER PRODUCTS ==
  1 17 BLENDER'S LICENSE.
  1 18    A person other than a supplier, restrictive supplier, or
  1 19 importer licensed under this division, who blends gasoline
  1 20 with alcohol distilled from cereal grains so that the blend
  1 21 contains at least ten percent alcohol distilled from cereal
  1 22 grains, shall obtain a blender's license.  A person other than
  1 23 a small biofuel producer who blends two or more special fuel
  1 24 products or sells one hundred percent biofuel shall obtain a
  1 25 blender's license.  The license shall be obtained by following
  1 26 the procedure under section 452A.4 and the license is subject
  1 27 to the same restrictions as contained in that section.  A
  1 28 blender other than a small biofuel producer shall maintain
  1 29 records as required by section 452A.10 as to motor fuel,
  1 30 alcohol, ethanol blended gasoline, and special fuels.
  1 31                           EXPLANATION
  1 32    Code chapter 452A provides for imposition of excise taxes
  1 33 on motor vehicle fuel, including gasoline and diesel fuel, as
  1 34 well as an excise tax on so=called special motor vehicle fuel,
  1 35 including a biofuel which is an oxygenated product derived
  2  1 from soybean oil, vegetable oil, or animal fats.  The oil is
  2  2 often blended with diesel fuel to create biodiesel.  A person
  2  3 who manufactures biofuel for use in motor vehicles, including
  2  4 as use in a blend, must obtain a blender's license.  The fuel
  2  5 is also taxed as a special fuel.  The rate of the excise tax
  2  6 on the use of special fuel is 22.5 cents per gallon.
  2  7    The bill exempts a small biofuel producer from the
  2  8 licensing requirements and the tax of Code chapter 452A.  A
  2  9 small biofuel producer must meet a number of qualifications.
  2 10 The producer must be a natural person and must use the biofuel
  2 11 in powering diesel engines.  The biofuel must be used for the
  2 12 person's own use or the use of other natural persons who
  2 13 reside in the household.  In addition, the producer cannot
  2 14 produce more than 300 gallons of biofuel during any year.
  2 15 LSB 2392SS 81
  2 16 da:rj/sh/8