HF 629 (LSB 1088YH (3) 89)

HOUSE FILE 629

BY  B. MEYER and OLSON

A BILL FOR

An Act relating to renewable fuel used to power motor vehicles, including by providing for standards and restricting the sale of gasoline not blended with ethanol, making penalties applicable, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  214.2A  Disciplinary action.
   The department may refuse to issue or renew and may suspend or revoke a license issued to a retail dealer pursuant to section 214.2 for a violation of this chapter, or chapter 214A, including rules adopted by the department pursuant to section 214A.2.
    Sec. 2.  Section 214A.1, Code 2021, is amended by adding the following new subsections:
   NEW SUBSECTION.  11A.  “Dispensing unit” means the equipment connected to a motor fuel pump located at a retail motor fuel site, if the equipment includes a nozzle to control the flow of motor fuel discharged from the motor fuel storage tank to an end point including the fuel supply tank of a motor vehicle.
   NEW SUBSECTION.  26B.  “Restricted use gasoline” means gasoline that meets the standards of section 214A.2 and is subject to restrictions based on classifications provided in section 214A.31.
   NEW SUBSECTION.  30B.  “Standard gasoline” means ethanol blended gasoline that meets the standards of section 214A.2 and is classified as provided in section 214A.31.
    Sec. 3.  Section 214A.1, subsection 16, Code 2021, is amended to read as follows:
   16.  “Gasoline” means any liquid product prepared, advertised, offered for sale, or sold for use as, or commonly and commercially used as, motor fuel for use in a spark-ignition, internal combustion engine, and which if it meets the specifications standards provided in section 214A.2.
    Sec. 4.  Section 214A.1, subsection 30, Code 2021, is amended by striking the subsection.
    Sec. 5.  NEW SECTION.  214A.1A  Disciplinary action.
   The department may refuse to issue or renew and may suspend or revoke a license issued to a retail dealer pursuant to section 214.2 for any violation of this chapter, including rules adopted by the department pursuant to section 214A.2.
    Sec. 6.  Section 214A.2, subsection 3, paragraph b, Code 2021, is amended by striking the paragraph and inserting in lieu thereof the following:
   b.  If the motor fuel is advertised for sale or sold as ethanol or ethanol blended gasoline, the motor fuel must comply with departmental standards which shall meet all of the following requirements:
   (1)  (a)  Ethanol must be a fuel grade agriculturally derived ethyl alcohol and must meet the requirements of 27 C.F.R. pts. 20 and 21 and A.S.T.M. international specification D4806 for blending with gasoline for use as automotive spark-ignition engine fuel, or a successor A.S.T.M. international specification, as established by rules adopted by the department.
   (b)  Ethanol shall be classified as E-100.
   (c)  Gasoline containing no ethanol or trace amounts of ethanol shall be classified as E-0.
   (2)  Gasoline blended with ethanol must meet requirements based in part or in whole on A.S.T.M. international specification D4814, or a successor A.S.T.M. international specification, as established by rules adopted by the department.
   (3)  Except as otherwise provided in this subparagraph, ethanol blended gasoline shall be classified as E-xx where “xx” is the volume percent of ethanol in the ethanol blended gasoline. However, all of the following shall apply:
   (a)  Ethanol blended gasoline with a percentage of at least nine but not more than ten percent by volume of ethanol shall be classified as E-10.
   (b)  Ethanol blended gasoline with a percentage of fifteen percent by volume of ethanol shall be classified as E-15.
   (c)  Ethanol blended gasoline with a percentage of at least seventy but not more than eighty-five percent by volume of ethanol shall be classified as E-85. E-85 gasoline must meet A.S.T.M. international specification D5798, or a successor A.S.T.M. international specification, as established by rules adopted by the department.
   (4)  In ensuring that ethanol blended gasoline meets the classification requirements of this section, the department shall take into account reasonable variations due to testing and other limitations.
   (5)  Ethanol blended gasoline classified as higher than E-20, other than E-85, must conform to A.S.T.M. international specifications adopted by the department.
    Sec. 7.  Section 214A.2, subsection 3, paragraph c, Code 2021, is amended by adding the following new subparagraph:
   NEW SUBPARAGRAPH.  (3)  (a)  Biobutanol blended gasoline shall be classified as Bu-xx where “xx” is the volume percent of biobutanol in the biobutanol blended gasoline.
   (b)  In ensuring that biobutanol blended gasoline meets the classification requirements of this section, the department shall take into account reasonable variations due to testing and other limitations.
    Sec. 8.  Section 214A.2, subsection 4, paragraph b, subparagraph (1), Code 2021, is amended by adding the following new subparagraph divisions:
   NEW SUBPARAGRAPH DIVISION.  (a)  Biodiesel shall be classified as B-100.
   NEW SUBPARAGRAPH DIVISION.  (b)  Diesel fuel containing no biodiesel or trace amounts of biodiesel shall be classified as B-0.
    Sec. 9.  Section 214A.2, subsection 4, paragraph b, Code 2021, is amended by adding the following new subparagraph:
   NEW SUBPARAGRAPH.  (04)  (a)  Biodiesel blended fuel shall be classified B-xx where “xx” is the volume percent of biodiesel in the biodiesel blended fuel.
   (b)  In ensuring that biodiesel blended fuel meets the classification requirements of this section, the department shall take into account reasonable variations due to testing and other limitations.
    Sec. 10.  Section 214A.2, subsection 5, Code 2021, is amended by striking the subsection.
    Sec. 11.  Section 214A.3, subsection 2, Code 2021, is amended to read as follows:
   2.  For a renewable fuel, all of the following apply:
   a.  A person shall not knowingly falsely advertise that a motor fuel for sale is a renewable fuel or is not a renewable fuel.
   b.  (1)  Ethanol blended A person shall not knowingly falsely advertise that gasoline sold by a dealer shall be designated according to its classification as provided in section 214A.2 for sale is or is not restricted use gasoline. However, a person advertising E-9 or E-10 gasoline may only designate it as ethanol blended gasoline. A person advertising ethanol blended gasoline formulated with a percentage of between seventy and eighty-five percent by volume of ethanol shall designate it as E-85. A person shall not knowingly falsely advertise ethanol blended gasoline for sale by using an inaccurate designation in violation of this subparagraph classification as provided in section 214A.2.
   (2)  A person shall not knowingly falsely advertise biobutanol blended gasoline for sale by using an inaccurate designation classification as provided in section 214A.2.
   (3)  A person shall not knowingly falsely advertise biodiesel fuel for sale by using an inaccurate designation classification as provided in section 214A.2.
    Sec. 12.  Section 214A.16, subsection 1, Code 2021, is amended to read as follows:
   1.  a.  If ethanol blended a retail dealer advertises for sale or sells restricted use gasoline is sold from a motor fuel pump dispensing unit, the motor fuel pump dispensing unit shall have affixed a decal identifying the ethanol blended gasoline is restricted use gasoline.
   b.  If the motor fuel pump dispenses a retail dealer advertises for sale or sells ethanol blended gasoline classified as E-11 to E-15 for use in gasoline-powered vehicles not required to be flexible fuel vehicles from a dispensing unit, the motor fuel pump dispensing unit shall have affixed a decal as prescribed by the United States environmental protection agency, including as provided in 40 C.F.R. pt. 80.
   c.  If the motor fuel pump dispenses a retail dealer advertises for sale or sells ethanol blended gasoline classified as higher than standard ethanol blended gasoline pursuant to section 214A.2 E-85 from a dispensing unit, the dispensing unit shall have affixed a decal shall contain language that identifies the ethanol blended gasoline is for use in flexible fuel vehicles as prescribed by the United States environmental protection agency.
   d.  If a retail dealer advertises for sale or sells biobutanol blended gasoline is sold from a motor fuel pump dispensing unit, the motor fuel pump dispensing unit shall have affixed a decal identifying the biobutanol blended gasoline.
   e.  If a retail dealer advertises for sale or sells biodiesel blended fuel is sold from a motor fuel pump dispensing unit, the motor fuel pump dispensing unit shall have affixed a decal identifying the biodiesel blended fuel as provided in 16 C.F.R. pt. 306.
    Sec. 13.  NEW SECTION.  214A.31  Renewable fuel requirements —— standard gasoline and restricted use gasoline.
   1.  a.  A retail dealer may advertise for sale or sell standard gasoline classified as E-10 or higher as provided in section 214A.2 from any number of dispensing units located at a retail motor fuel site.
   b.  Except as provided in subsection 2, a retail dealer shall not advertise for sale or sell restricted use gasoline classified as E-0 from more than one dispensing unit located at a retail motor fuel site.
   2.  A retail dealer may advertise for sale or sell restricted use gasoline from one or more dispensing units located at a restricted retail motor fuel site. For purposes of this section, a restricted retail motor fuel site is limited to any of the following:
   a.  An airport as defined in section 328.1.
   b.  A facility primarily used to support motor vehicles that are not registered for highway use, including but not limited to a location dedicated to motor vehicle racing.
   c.  A marina that provides a secured mooring or dry dock storage for watercraft as defined in section 462A.2.
   d.  A location that is primarily used to store or sell any of the following:
   (1)  Motor vehicles manufactured before 1985.
   (2)  All-terrain vehicles or motorcycles, as those terms are defined in section 321.1, or snowmobiles as defined in section 321G.1.
    Sec. 14.  NEW SECTION.  214A.32  Renewable fuel —— restricted use gasoline waiver.
   1.  The secretary of agriculture may issue or renew an administrative order temporarily waiving a requirement that a retail dealer comply with section 214A.31.
   2.  The order shall allow the retail dealer to advertise for sale and sell restricted use gasoline from any number of dispensing units at the retail dealer’s retail motor fuel site.
   3.  The order must be supported by credible evidence that the retail dealer has not been able to reasonably obtain standard gasoline to offer for sale or sell at the retail dealer’s retail motor fuel site.
   4.  An order shall not apply to more than one retail motor fuel site.
   5.  The department shall publish a copy of the order on the department’s internet site within ten days after its issuance.
   6.  The order shall expire six months from the date of its issuance, unless a shorter period is stated in the order.
    Sec. 15.  EFFECTIVE DATE.  This Act takes effect January 1, 2022.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   STANDARDS. This bill provides for the regulation of motor fuel, which provisions are administered and enforced by the department of agriculture and land stewardship (DALS) (Code chapter 214A). This includes two types of motor fuel, including gasoline, and specifically ethanol blended gasoline beginning with an ethanol percentage of between 9 and 10 percent by volume (E-10). It also includes diesel fuel, and specifically biodiesel blended fuel beginning with a minimum biodiesel percentage of 1 percent (B-1). The bill amends standards governing motor fuel and classifications of motor fuel including nonblended gasoline (e.g., E-0) and blended formulations (e.g., E-10).
   RESTRICTED USE GASOLINE PROHIBITED. The bill designates nonblended gasoline classified as E-0 as restricted use gasoline (amended Code section 214A.1 and new Code section 214A.31), and prohibits its sale in this state. The bill expressly allows the sale of standard gasoline which is ethanol blended gasoline classified as E-10 or higher. The bill does recognize two types of exceptions. A single dispensing unit may be reserved at a site to dispense restricted use gasoline. A restricted site may be used to dispense restricted use gasoline from any number of dispensing units. Such restricted sites include an airport, a facility servicing motor vehicles engaged in racing, a marina, or a location used to store or sell older model motor vehicles, all-terrain vehicles, motorcycles, or snowmobiles.
   ADVERTISING AND NOTICE PROVISIONS. The bill requires that when advertising gasoline for sale, a dealer must designate its restricted status (amended Code section 214A.3). It eliminates a provision that requires that a decal be placed on a motor fuel pump that notifies the traveling public that gasoline is blended with ethanol. It provides that a decal must identify gasoline as restricted (amended Code section 214A.16).
   WAIVER AND SUSPENSION. The bill authorizes the secretary of agriculture to issue an order temporarily waiving a requirement that a dealer comply with the restricted use requirements if there is credible evidence that the dealer has not been able to reasonably obtain standard gasoline (new Code section 214A.32). 
   PENALTY. A person who violates a provision of Code chapter 214A is guilty of a serious misdemeanor (Code section 214A.11). A serious misdemeanor is punishable by confinement for no more than one year and a fine of at least $430 but not more than $2,560. Alternatively, the state may initiate an alternative civil proceeding against the person for at least $100 but not more than $1,000 for each violation.
   EFFECTIVE DATE. The bill takes effect January 1, 2022.