S.F. 164 Section 1. Section 214A.2, subsection 4, paragraph b, 1 subparagraph (2), Code 2011, is amended by striking the 2 subparagraph. 3 Sec. 2. NEW SECTION . 214A.2C Standard for diesel fuel —— 4 biodiesel required. 5 1. A retail dealer shall not advertise for sale or sell 6 diesel fuel in this state, unless it is biodiesel fuel 7 designated as B-5 or higher as specified in section 214A.2. 8 2. Subsection 1 does not apply to diesel fuel used to power 9 any of the following: 10 a. (1) A motor located at an electric generating plant 11 regulated by the United States nuclear regulatory commission. 12 (2) This paragraph “a” is repealed thirty days after the 13 United States nuclear regulatory commission approves the use of 14 biodiesel fuel designated as B-5 or higher in motors located at 15 electric generating plants that it regulates. 16 b. A railroad locomotive. 17 c. A vehicle used primarily on the grounds of a public 18 airport. 19 d. A motor used to temporarily generate power due to 20 peak demand for electricity or a disruption in the delivery 21 of electricity or natural gas until the delivery of the 22 electricity or natural gas may be resumed. 23 3. Subsection 1 does not apply during a period that the 24 governor issues a biodiesel suspension order. 25 a. The biodiesel suspension order must include a 26 determination by the governor that any of the following exists: 27 (1) A lack of infrastructure in this state necessary to 28 support the retail sale of biodiesel fuel designated as B-5. 29 (2) A significant shortage of biodiesel fuel designated as 30 B-5 in this state available for retail sale in this state. 31 (3) A systemic market change in the supplies or prices of 32 biodiesel fuel designated B-5 will cause a material economic 33 hardship to the state. 34 b. The biodiesel suspension order may reduce the biodiesel 35 -1- LSB 2150XS (7) 84 da/rj 1/ 3

S.F. 164 fuel designation provided in subsection 1 during the period of 1 the suspension. The biodiesel suspension order may apply to 2 the entire state or to specific counties named in the biodiesel 3 suspension order. 4 c. The biodiesel suspension order shall take effect 5 when published in the Iowa administrative bulletin unless 6 the biodiesel suspension order specifies a later date. The 7 biodiesel suspension order shall terminate on a date certain as 8 specified in the biodiesel suspension order. 9 Sec. 3. EXISTING INVENTORIES OF DIESEL FUEL. 10 1. a. Notwithstanding section 214A.2C, diesel fuel 11 inventories, stored at a retail motor fuel site as defined in 12 section 214A.1, existing on the effective date of this Act, may 13 continue to be sold and dispensed. 14 b. Paragraph “a” shall not apply once all diesel fuel 15 inventories existing at a retail motor fuel site as defined in 16 section 214A.1, on the effective date of this Act, have been 17 sold or dispensed. 18 2. Nothing in this section authorizes a retail dealer to 19 acquire diesel fuel other than biodiesel fuel designated B-5 or 20 higher as provided in section 214A.2 on or after the effective 21 date of this Act. 22 Sec. 4. RULES. The department of agriculture and land 23 stewardship shall adopt rules, to be effective September 1, 24 2012, as necessary to implement this Act. 25 Sec. 5. EFFECTIVE DATE. This Act takes effect September 26 1, 2012, except for the provisions authorizing the department 27 of agriculture and land stewardship to adopt rules required to 28 implement the provisions of section 214A.2C, as enacted in this 29 Act. 30 EXPLANATION 31 This bill applies to the retail sale of biodiesel blended 32 fuel as regulated by the department of agriculture and land 33 stewardship under Code chapter 214A. 34 The bill prohibits a retail dealer from advertising the 35 -2- LSB 2150XS (7) 84 da/rj 2/ 3

S.F. 164 sale or selling of diesel fuel unless it is biodiesel fuel 1 and requires that all diesel fuel contain a minimum of 5 2 rather than 1 percent biodiesel. The bill provides for a 3 number of exceptions, including for motors located at an 4 electric generating plant regulated by the nuclear regulatory 5 commission, locomotives, vehicles used primarily on the grounds 6 of a public airport, and motors used to temporarily generate 7 electricity. 8 The bill allows the governor to issue a biodiesel suspension 9 order based on a determination that there is not sufficient 10 infrastructure in the state, there is a shortage of biodiesel 11 fuel, or the standard will cause a material economic hardship 12 to the state. 13 The bill allows a retail dealer to sell remaining 14 inventories of diesel fuel. 15 The bill takes effect September 1, 2012, except for the 16 provision requiring the department of agriculture and land 17 stewardship to adopt rules which would take effect July 1. 18 A person who violates a provision of Code chapter 214A is 19 guilty of a serious misdemeanor with each day of a continuing 20 violation consisting of a separate offense. The state may 21 also proceed against a person who violates the Code chapter 22 by bringing a civil enforcement action as a contested case 23 proceeding under Code chapter 17A in lieu of a prosecution. A 24 serious misdemeanor is punishable by confinement for no more 25 than one year and a fine of at least $315 but not more than 26 $1,875. The civil penalty shall be for at least $100 but not 27 more than one $1,000 for each violation. 28 -3- LSB 2150XS (7) 84 da/rj 3/ 3