Senate File 2382 - Reprinted SENATE FILE 2382 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SF 2103) (As Amended and Passed by the Senate March 22, 2010 ) A BILL FOR An Act relating to fuel, including standards for biodiesel 1 blended fuel, and excise taxes imposed upon special fuel, 2 including biodiesel fuel and diesel fuel used in the 3 production of biodiesel blended fuel. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 SF 2382 (5) 83 da/rj/jh

S.F. 2382 Section 1. Section 214A.2, subsection 4, paragraph b, 1 Code Supplement 2009, is amended by adding the following new 2 subparagraph: 3 NEW SUBPARAGRAPH . (4) Biodiesel blended fuel designated as 4 from B-6 through B-20 must conform to A.S.T.M. international 5 specification D7467 or a successor A.S.T.M. international 6 specification as established by rules adopted by the 7 department. 8 Sec. 2. Section 452A.2, Code 2009, is amended by adding the 9 following new subsections: 10 NEW SUBSECTION . 3A. “Biodiesel producer” means a person who 11 produces at least one hundred thousand gallons of biodiesel on 12 a calendar year basis from a production facility and which is 13 required to be licensed pursuant to this division. 14 NEW SUBSECTION . 9A. “Diesel fuel” means the same as defined 15 in section 214A.1. 16 Sec. 3. Section 452A.2, subsection 29, Code 2009, is amended 17 to read as follows: 18 29. “Nonterminal storage facility” means a facility where 19 motor fuel or special fuel, other than liquefied petroleum 20 gas, is stored that is not supplied by a pipeline or a marine 21 vessel. “Nonterminal storage facility” includes a facility that 22 manufactures products such as ethanol as defined in section 23 214A.1 , biofuel, blend stocks, or additives which may be used 24 as motor fuel or special fuel, other than liquefied petroleum 25 gas, for operating motor vehicles or aircraft. 26 Sec. 4. Section 452A.3, subsection 3, Code Supplement 2009, 27 is amended to read as follows: 28 3. a. For the privilege of operating motor vehicles or 29 aircraft in this state, there is imposed an excise tax on the 30 use of special fuel in a motor vehicle or aircraft. 31 (1) The tax rate on special fuel for diesel engines of motor 32 vehicles is twenty-two and one-half cents per gallon. The tax 33 rate on biodiesel fuel for diesel engines of motor vehicles 34 shall be determined on a gross volume basis by all persons 35 -1- SF 2382 (5) 83 da/rj/jh 1/ 3

S.F. 2382 except a biodiesel producer. A biodiesel producer shall remit 1 the tax on a volume basis with the gross metered gallons 2 adjusted to sixty degrees Fahrenheit. 3 (2) The rate of tax on special fuel for aircraft is three 4 cents per gallon. 5 (3) On all other special fuel, unless otherwise specified in 6 this section, the per gallon rate is the same as the motor fuel 7 tax. 8 b. Indelible dye meeting United States environmental 9 protection agency and internal revenue service regulations 10 must be added to special fuel before or upon withdrawal at a 11 terminal or refinery rack for that special fuel to be exempt 12 from tax and the dyed special fuel may be used only for an 13 exempt purpose. 14 Sec. 5. Section 452A.17, subsection 1, paragraph a, Code 15 Supplement 2009, is amended by adding the following new 16 subparagraph: 17 NEW SUBPARAGRAPH . (11) Diesel fuel used by a nonterminal 18 storage facility to blend with biodiesel to produce biodiesel 19 blended fuel, if the biodiesel blended fuel is distributed 20 to a blender licensed pursuant to section 452A.6 who is also 21 required to pay the excise tax on that same diesel fuel. 22 Sec. 6. Section 452A.86, Code 2009, is amended to read as 23 follows: 24 452A.86 Method of determining gallonage. 25 1. The exclusive method of determining gallonage of 26 any purchases or sales of motor fuel, undyed special fuel, 27 compressed natural gas, or liquefied petroleum gas as defined 28 in this chapter and distillate fuels shall be on a gross volume 29 basis. A temperature-adjusted or other method shall not be 30 used, except as it applies to biodiesel sold at a production 31 facility operated by a biodiesel producer, liquefied petroleum 32 gas and , or the sale or exchange of petroleum products between 33 petroleum refiners. All invoices, bills of lading, or other 34 records of sale or purchase and all returns or records required 35 -2- SF 2382 (5) 83 da/rj/jh 2/ 3

S.F. 2382 to be made, kept, and maintained by a supplier, restrictive 1 supplier, importer, exporter, blender, or compressed natural 2 gas or liquefied petroleum gas dealer or user shall be made, 3 kept, and maintained on the gross volume basis. 4 2. For purposes of this section, “distillate fuels” means 5 any fuel oil, gas oil, topped crude oil, or other petroleum 6 oils derived by refining or processing crude oil or unfinished 7 oils which have a boiling range at atmospheric pressure which 8 falls completely or in part between five hundred fifty and 9 twelve hundred degrees Fahrenheit. 10 -3- SF 2382 (5) 83 da/rj/jh 3/ 3