Bill Text: HI SB1307 | 2010 | Regular Session | Introduced

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Bill Title: Alcohol Fuels; Renewable Fuel Standard

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2009-05-11 - Carried over to 2010 Regular Session. [SB1307 Detail]

Download: Hawaii-2010-SB1307-Introduced.html

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Report Title:

Alcohol Fuels; Renewable Fuel Standard

 

Description:

Improve Hawaii's economic and energy security position by establishing a preference for locally produced alcohol fuels.

 

THE SENATE	S.B. NO.	1307
TWENTY-FIFTH LEGISLATURE, 2009
STATE OF HAWAII

A BILL FOR AN ACT

 

 

relating to ALCOHOL FUELS.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  The purpose of this Act is to improve Hawaii's economic and energy security position by establishing a preference for locally produced alcohol fuels.

     The preference is established by shifting the benefits conferred under existing law to "locally produced alcohol fuels" and allocating the general excise tax exemption for alcohol fuels as a function of local alcohol fuel production capacity under the renewable fuel standard.  Thus, when local production capacity meets one hundred per cent of the renewable fuel standard, the fuel tax exemption will only apply to locally produced alcohol fuels.

     This Act is intended to expand the local production of alcohol fuels necessary to meet Hawaii's renewable fuel objectives and reduce state expenditures on ethanol imports.

     SECTION 2.  Section 237-27.1, Hawaii Revised Statutes, is amended to read as follows:

     "§237-27.1  Exemption of sale of alcohol fuels.  (a)  There shall be exempted from, and excluded from the measure of, the taxes imposed by this chapter all of the gross income or gross proceeds arising from the sale of alcohol fuels, as defined in subsection (b), for consumption or use by the purchaser and not for resale.  The exemption shall apply to alcohol fuels utilized to meet the State's renewable fuel standard and shall be administered based on the local alcohol fuel production capacity for that tax year, as determined by the department of business, economic development, and tourism.

     (b)  For the purposes of this section, ["alcohol fuels"]

     "Alcohol fuels means neat biomass-derived alcohol liquid fuel or a petroleum-derived fuel and alcohol liquid fuel mixture consisting of at least ten volume per cent denatured biomass-derived alcohol commercially usable as a fuel to power aircraft, seacraft, spacecraft, motor vehicles, or other motorized vehicles.

     "Input materials" include biomass feedstock and the chemical inputs required for conversion of the biomass feedstock into alcohol fuel.

     "Local alcohol fuel production" or "local production" or "locally produced" means alcohol fuel in which at least seventy five per cent of the total inputted materials in the alcohol fuel are produced and purchased within the State.

     "Non-locally produced alcohol fuel" or "non-locally produced" means alcohol fuel that has less than seventy five per cent of the total inputted materials in the alcohol fuel, produced and purchased within the State.  The percentage composition of alcohol fuel shall be declared by the alcohol fuel distributor at the point of sale to the retailer and documented on sales receipts.

     (c)  This section shall be administered as follows:

     (1)  If local production capacity reaches twenty five per cent of the renewable fuel standard, fuels blended with non-locally produced alcohol fuels shall be exempt for not more than seventy five per cent of the renewable fuel standard;

     (2)  If local production capacity reaches fifty per cent of the renewable fuel standard, fuels blended with non-locally produced alcohol fuels shall be exempt for not more than fifty per cent of the renewable fuel standard;

     (3)  If local production capacity reaches seventy five per cent of the renewable fuel standard, fuels blended with non-locally produced alcohol fuels shall be exempt for not more than twenty five per cent of the renewable fuel standard; and

     (4)  If local production capacity reaches one hundred per cent of the renewable fuel standard, only locally produced alcohol fuels shall qualify for the exemption.

     (d)  Retail fuel distributors shall meet the requirements of the Hawaii renewable fuel standard and report to the energy resources coordinator pursuant to law. Producers and distributors shall be required to designate alcohol fuel sales as locally or non-locally produced.  The percentage composition of alcohol fuel sold shall be declared by the alcohol producer at the point of sale to distributor or retailer and documented on sales receipts.

     [(c)] (e)  A producer, wholesaler, or retailer of alcohol fuels shall pass any savings realized from this exemption on to the end consumer.  Any producer or wholesaler who violates this subsection shall be subject to a fine of $100,000.  Notwithstanding any law to the contrary, a violation of this subsection shall be deemed an unfair or deceptive act or practice in violation of, and enforceable under, chapter 480.

     [(d)] (f)  The director of taxation shall adopt rules pursuant to chapter 91 necessary to administer this section."

     SECTION 3.  Act 209 Session Laws of Hawaii, 2007 is amended by amending section 6 to read as follows:

     "SECTION 6.  This Act shall take effect on July 1, 2007; provided that section 2 of this Act shall be repealed on June 30, [2009.] 2015."

     SECTION 4.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect upon its approval and shall apply to taxable years beginning after December 31, 2008.

 

INTRODUCED BY:	_____________________________