Bill Text: IA HF859 | 2021-2022 | 89th General Assembly | Introduced

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Bill Title: A bill for an act relating to renewable fuel used to power motor vehicles, including by providing for standards and restrictions, infrastructure, tax credits, and requirements for state agencies operating motor vehicles powered by renewable fuel, providing penalties, making penalties applicable, and including effective date provisions.(Formerly HSB 185.)

Spectrum: Committee Bill

Status: (Introduced - Dead) 2021-05-20 - Referred to Ways and Means. H.J. 1203. [HF859 Detail]

Download: Iowa-2021-HF859-Introduced.html

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House File 859 - Introduced
HOUSE FILE 859
BY COMMITTEE ON WAYS AND MEANS
(SUCCESSOR TO HSB 185)
A BILL FOR
An Act relating to renewable fuel used to power motor vehicles,
including by providing for standards and restrictions,
infrastructure, tax credits, and requirements for state
agencies operating motor vehicles powered by renewable
fuel, providing penalties, making penalties applicable, and
including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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DIVISION I
MOTOR FUEL
PART A
STANDARDS AND CLASSIFICATIONS
Section 1. Section 214A.1, Code 2021, is amended by adding
the following new subsections:
NEW SUBSECTION . 8A. “Clear diesel fuel” means diesel fuel
that is not dyed under section 452A.3, subsection 3, paragraph
“b” , and that is regularly sold to members of the general
public by retail dealers to power motor vehicles subject
to registration under chapter 321 to operate on the public
highways.
NEW SUBSECTION . 11A. “Dispensing unit” means equipment that
is part of motor fuel storage and dispensing infrastructure, 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 . 19A. “Motor fuel storage and dispensing
infrastructure” or “infrastructure” means a motor fuel storage
tank, motor fuel pump, and a dispensing unit necessary to store
and dispense, or store, blend, and dispense, motor fuel at
a retail motor fuel site, including but not limited to all
associated equipment, dispensing units, dispensers, pumps,
pipes, hoses, tubes, lines, fittings, valves, filters, seals,
and covers.
NEW SUBSECTION . 29A. “Small retail dealer” means a retail
dealer engaged in the business of storing and dispensing motor
fuel from a motor fuel pump for sale on a retail basis at fewer
than ten permanent retail motor fuel sites.
NEW SUBSECTION . 29B. “Special use diesel fuel” means clear
diesel fuel subject to restrictions based on a designated
classification as provided in section 214A.34.
NEW SUBSECTION . 29C. a. “Special use gasoline” means
unleaded gasoline that is subject to restrictions based on a
designated classification as provided in sections 214A.31 and
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214A.32.
b. “Special use gasoline” does not include aviation gasoline
or racing fuel as those terms are defined in section 452A.2.
NEW SUBSECTION . 30A. “Standard use diesel fuel” means clear
diesel fuel that includes a required blend of biodiesel based
on a designated classification as provided in section 214A.34.
NEW SUBSECTION . 30B. a. “Standard use gasoline” means
unleaded gasoline that includes a required blend of ethanol
based on a designated classification as provided in sections
214A.31 and 214A.32.
b. “Standard use gasoline” does not include aviation
gasoline or racing fuel as those terms are defined in section
452A.2.
Sec. 2. Section 214A.1, subsections 11 and 16, Code 2021,
are amended to read as follows:
11. a. “Diesel fuel” means any liquid, other than gasoline,
which is suitable for use as a type of motor fuel for use in
a diesel fuel powered engine, including but not limited to a
motor vehicle, equipment as defined in section 322F.1 , or a
train railroad locomotive, and which meets the standards and
classifications provided in section 214A.2 .
b. Diesel fuel “Diesel fuel” includes a liquid product
prepared, advertised, offered for sale, or sold for use as,
or commonly and commercially used as, motor fuel for use in
an internal combustion engine and ignited by pressure without
the presence of an electric spark. Diesel fuel must meet the
standards provided in section 214A.2 .
16. “Gasoline” means any liquid product prepared,
advertised, offered for sale , or sold for use as, or commonly
and commercially used as, a type of motor fuel for use in a
spark-ignition, internal combustion engine, and which meets
the specifications standards and classifications provided in
section 214A.2 .
Sec. 3. Section 214A.1, subsection 30, Code 2021, is amended
by striking the subsection.
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Sec. 4. NEW SECTION . 214A.1A Rules.
The department shall adopt rules necessary or desirable to
administer and enforce this chapter in conjunction with chapter
214.
Sec. 5. Section 214A.2, subsections 1 and 2, Code 2021, are
amended to read as follows:
1. The department shall adopt rules pursuant to chapter
17A for carrying out this chapter . The rules may include but
are not limited to specifications section 214A.1A relating
to standards and classifications for types of motor fuel,
including but not limited to gasoline and diesel fuel.
The rules shall provide standards and classifications for
renewable fuel such as ethanol blended gasoline, biobutanol
blended gasoline, biodiesel, biodiesel blended fuel, and
motor fuel components such as a biofuel or an oxygenate. In
the interest of uniformity, the department shall adopt by
reference other specifications standards relating to tests and
standards specifications for types of motor fuel, including
renewable fuel and motor fuel components, established by the
United States environmental protection agency and A.S.T.M.
international.
2. Octane number An octane rating assigned to gasoline
shall conform to the average of values obtained from the
A.S.T.M. international D2699 research method and the A.S.T.M.
international D2700 motor method.
a. Octane number for For regular grade unleaded gasoline
shall follow the specifications of A.S.T.M. international but ,
the octane rating shall be not be less than eighty-seven and
not more than ninety .
b. Octane number for For premium grade unleaded gasoline
shall follow the specifications of A.S.T.M. international but ,
the octane rating shall not be not less than ninety ninety-one .
Sec. 6. Section 214A.2, subsection 3, paragraph b, Code
2021, is amended by striking the paragraph and inserting in
lieu thereof the following:
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b. If the motor fuel is advertised for sale or sold as
ethanol or ethanol blended gasoline, the motor fuel must meet
departmental standards and classifications based on 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. 19 through 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) For any classification of ethanol blended gasoline, at
least nine percent by volume must be ethanol.
(4) For ethanol blended gasoline classified as E-10 or
higher, the state grants a waiver of one pound per square inch
from the A.S.T.M. international specification D4814 Reid vapor
pressure requirement.
(5) 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
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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.
(6) Ethanol blended gasoline classified as higher than
E-15, other than E-85, must conform to standards adopted by the
department.
(7) In ensuring that ethanol blended gasoline meets the
classification requirements of this section, the department
shall take into account up to a two percent variation in the
volume percent of ethanol in ethanol blended gasoline due to
testing and other limitations as determined 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 up to a two percent variation in the
volume percent of biobutanol in biobutanol blended gasoline
due to testing and other limitations as determined by the
department.
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
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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 up to a two percent variation in the
volume percent of biodiesel in biodiesel blended fuel due to
testing and other limitations as determined by the department.
Sec. 10. Section 214A.2, subsection 4, paragraph b,
subparagraph (4), Code 2021, is amended to read as follows:
(4) Biodiesel blended fuel classified as B-6 or higher
but not higher than up to and including B-20 must conform to
A.S.T.M. international specification D7467 , or a successor
A.S.T.M. international specification , as established by rules
adopted by the department.
Sec. 11. Section 214A.2, subsection 4, paragraph b, Code
2021, is amended by adding the following new subparagraph:
NEW SUBPARAGRAPH . (5) (a) Biodiesel blended fuel
classified as higher than B-20 must conform to standards
adopted by the department.
(b) The rules adopted by the department of agriculture and
land stewardship establishing standards for biodiesel blended
fuel classified as higher than B-20 shall take effect not
earlier than sixty days after the date for filing as provided
in section 17A.5, subsection 2, paragraph “b” , subparagraph
(1), subparagraph division (a). The department of agriculture
and land stewardship shall notify the legislative services
agency and the department of revenue of the effective date of
rules at least thirty days prior to the effective date of the
rules.
Sec. 12. Section 214A.2, subsection 5, Code 2021, is amended
by striking the subsection.
Sec. 13. 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
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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 standard use gasoline or special 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 standard
use gasoline or special use 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 that diesel fuel for sale is or is not standard use
diesel fuel or special use diesel fuel. A person shall not
knowingly falsely advertise standard use diesel fuel or special
use diesel fuel for sale by using an inaccurate designation
classification as provided in section 214A.2 .
Sec. 14. Section 214A.11, Code 2021, is amended by adding
the following new subsections:
NEW SUBSECTION . 3. 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.
NEW SUBSECTION . 4. A retail dealer who advertises the sale
of motor fuel at a retail motor fuel site shall not be subject
to a criminal or civil penalty or an administrative action
suspending or revoking a license as provided in this section,
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if a person fails to dispense the classification of ethanol
blended gasoline or biodiesel blended fuel otherwise required
in subchapter IV and the retail dealer complies with the other
applicable requirements of that subchapter.
Sec. 15. NEW SECTION . 214A.31 Special use gasoline
classified as E-0 —— restrictions.
A retail dealer shall not knowingly advertise for sale or
knowingly sell special use gasoline classified as E-0 as
provided in section 214A.2, unless the gasoline is premium
grade unleaded gasoline as provided in that section.
Sec. 16. NEW SECTION . 214A.32 Special use gasoline
classified as E-10 —— restrictions —— future implementation.
1. A retail dealer shall not knowingly advertise for sale
special use gasoline classified as E-10 or higher up to but not
including E-15, as provided in section 214A.2.
2. Notwithstanding subsection 1, a retail dealer may
advertise for sale special use gasoline classified as E-10 or
higher to power an engine that operates any of the following:
a. A 2000 or older model year motor vehicle.
b. A motorcycle as defined in section 321.1.
c. An all-terrain vehicle as defined in section 321.1.
d. A snowmobile as defined in section 321G.1.
e. A vehicle serviced by a marina, dock, or airport.
f. A vehicle principally designed for use off a public
highway.
g. Machinery or equipment not primarily designed to
transport a person or property.
3. a. This section shall be implemented on January 1, 2028.
b. This subsection is repealed January 2, 2028.
Sec. 17. NEW SECTION . 214A.33 Standard use gasoline
classified as E-15 or higher —— future implementation.
1. A retail dealer shall not knowingly advertise for sale
or knowingly sell gasoline from more than two dispensing units
located at a retail motor fuel site, unless the retail dealer
advertises for sale standard use gasoline classified as E-15
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or higher from at least one of the dispensing units located at
that retail motor fuel site.
2. a. This section shall be implemented on January 1, 2028.
b. This subsection is repealed January 2, 2028.
Sec. 18. NEW SECTION . 214A.34 Standard use diesel fuel ——
restrictions.
1. For the period of each year beginning April 1 and ending
October 31, a retail dealer shall not knowingly advertise for
sale clear diesel fuel other than standard use diesel fuel
classified as B-11 or higher as provided in section 214A.2.
2. Notwithstanding subsection 1, a retail dealer may
advertise for sale special use diesel fuel classified as B-0 or
higher to power an engine that operates any of the following:
a. A vehicle serviced by a marina, dock, or airport.
b. A vehicle principally designed for use off a public
highway.
c. Machinery or equipment not primarily designed to
transport a person or property.
3. This section does not apply to diesel fuel used to power
aircraft, railroad locomotives, vessels of the United States
coast guard, or vessels subject to inspection under 46 U.S.C.
§3301.
Sec. 19. NEW SECTION . 214A.35 Labeling of dispensing units
—— federal law.
A retail dealer advertising the sale of motor fuel shall
affix a label to each dispensing unit used to discharge a motor
fuel as required by federal law, including by the United States
federal trade commission as provided in 16 C.F.R. §306.12, and
the United States environmental protection agency as provided
in 40 C.F.R. pt. 80, including §80.570 and 80.1501.
Sec. 20. NEW SECTION . 214A.36 Labeling of dispensing units
—— state law —— future implementation.
1. A retail dealer restricted from advertising the sale of
special use gasoline as provided in section 214A.31 shall affix
a clearly visible decal to each dispensing unit discharging
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such gasoline. The decal shall identify the gasoline as
special use gasoline.
2. a. A retail dealer restricted from advertising the
sale of special use gasoline as provided in section 214A.32
shall affix a clearly visible decal to each dispensing unit
discharging such gasoline. The decal shall identify the
gasoline as special use gasoline and list the types of engines
that may be powered by using that gasoline as provided in
section 214A.32, subsection 2.
b. (1) This subsection shall be implemented on January 1,
2028.
(2) This paragraph “b” is repealed January 2, 2028.
3. A retail dealer advertising the sale of biobutanol
blended gasoline from a dispensing unit shall affix to the
dispensing unit a decal identifying the gasoline as biobutanol
blended gasoline.
4. A retail dealer restricted from advertising the sale
of special use diesel fuel as provided in section 214A.34
shall affix a clearly visible decal to each dispensing unit
discharging such diesel fuel. The decal shall identify the
diesel fuel as special use diesel fuel and list the types
of engines that may be powered by using that diesel fuel as
provided in section 214A.34, subsection 2.
5. The design and location of a decal required in this
section shall be prescribed by rules adopted by the department.
A decal identifying a renewable fuel shall be consistent with
standards adopted pursuant to section 159A.6. The department
may approve an application to place a decal in a special
location on a dispensing unit or use a decal with special
lettering or colors, if the decal appears clear and conspicuous
to the consumer. The application shall be submitted in writing
pursuant to procedures adopted by the department.
Sec. 21. NEW SECTION . 214A.41 Waiver of renewable fuel
requirements.
1. The governor may issue or renew an executive order or the
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secretary of agriculture may issue or renew an administrative
order temporarily waiving a requirement that a retail dealer
comply with a provision in part 1 of this subchapter.
2. The order may allow the retail dealer to advertise
for sale special use gasoline classified as E-0 as regular
grade unleaded gasoline as provided in section 214A.2,
notwithstanding section 214A.31.
3. a. The order may allow the retail dealer to advertise
for sale special use gasoline classified as E-10 or higher
from any number of dispensing units at the retail dealer’s
retail motor fuel site without any restriction, notwithstanding
section 214A.32 or 214A.33.
b. (1) This subsection shall be implemented on January 1,
2028.
(2) This paragraph “b” is repealed January 2, 2028.
4. The order may allow the retail dealer to advertise
for sale special use diesel fuel classified as B-0 or higher
without any restriction otherwise provided in section 214A.34.
5. The order must be supported by credible evidence that
the retail dealer has not been able to reasonably obtain the
required grade or classification of standard use gasoline or
standard use diesel fuel at the retail dealer’s retail motor
fuel site.
6. An order may apply to more than one retail motor fuel
site, if each such retail motor fuel site is listed in the
order.
7. The department shall publish a copy of the order on the
department’s internet site within ten days after its issuance.
8. The order shall expire six months from the date of its
issuance, unless a shorter period is stated in the order.
The early expiration of the order may also occur based on
circumstances described in the order.
Sec. 22. NEW SECTION . 214A.42 Suspension of renewable fuel
requirements.
1. The governor may issue or renew an executive order that
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temporarily suspends a requirement that retail dealers comply
with a provision in part 1 of this subchapter on either a
statewide basis or in a geographic region of the state.
2. The order may allow retail dealers to advertise for
sale special use gasoline classified as E-0 as regular
grade unleaded gasoline as provided in section 214A.2,
notwithstanding section 214A.31.
3. a. The order may allow retail dealers to advertise
for sale special use gasoline classified as E-10 or higher to
customers from any number of dispensing units at retail motor
fuel sites without restriction, notwithstanding section 214A.32
or 214A.33.
b. (1) This subsection shall be implemented on January 1,
2028.
(2) This paragraph “b” is repealed January 2, 2028.
4. The order may allow retail dealers to advertise for sale
special use diesel fuel classified as B-0 or higher without the
restrictions otherwise provided in section 214A.34, subsection
2.
5. The order must be based on the governor’s determination
that any of the following apply:
a. There is not adequate infrastructure to store and
dispense the required standard use gasoline or standard use
diesel fuel at retail motor fuel sites in this state or the
region of this state described in the order.
b. It is not commercially feasible to obtain the standard
use gasoline or standard use diesel fuel to be advertised for
sale or sold at retail motor fuel sites in this state or the
region of this state described in the order.
6. The order shall take effect on its date of publication in
the Iowa administrative bulletin, unless the order specifies
a later date. The order shall expire one year from the date
of its publication unless a shorter period is stated in the
order. The early expiration of the order may also occur based
on circumstances described in the order.
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Sec. 23. NEW SECTION . 214A.43 Extension of special use
gasoline requirements —— future implementation.
1. As used in this section, “department” means the
department of natural resources.
2. The director of the department may issue an
administrative order granting a small retail dealer an extended
period of compliance to meet the requirements of section
214A.32 or 214A.33.
3. A small retail dealer must apply for an extended period
of compliance by submitting a form to the department in a
manner and according to procedures required by the department.
4. The department may grant an extended period of compliance
to a small retail dealer for each retail motor fuel site
identified in the application, if the department determines all
of the following:
a. The small retail dealer cannot comply with section
214A.32 or 214A.33 because the retail motor fuel site’s
existing underground motor fuel storage and dispensing
infrastructure is incompatible with standard use gasoline
classified as E-15 or higher.
b. The small retail dealer would suffer significant
financial hardship, measured on the basis of income to expense
ratio, if the small retail dealer improved a retail motor fuel
site to store and dispense standard use gasoline classified
as E-15 or higher by installing, replacing, or converting
infrastructure.
c. The department of agriculture and land stewardship
submits a statement to the department of natural resources
certifying the small retail dealer’s proposed financing of
ethanol infrastructure at the retail motor fuel site. The
statement shall at least include all of the following:
(1) The small retail dealer has applied to participate in
the renewable fuel infrastructure program for retail motor
fuel sites as provided in section 159A.14 to improve the
retail motor fuel site by installing, replacing, or converting
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infrastructure to be used to store, dispense, or blend and
dispense ethanol blended gasoline.
(2) The small retail dealer is eligible to participate in
the program as described in subparagraph (1), regardless of
whether the small retail dealer’s application is approved.
(3) If the small retail dealer’s application is approved,
the retail motor fuel site has not yet been improved as
provided in subparagraph (1), using moneys awarded to the
participating person according to the terms of a cost-share
agreement as provided in section 159A.14.
5. The order shall take effect on its date of publication in
the Iowa administrative bulletin, unless the order specifies
a later date. The order shall expire five years from the date
of its publication unless a shorter period is stated in the
order. The early expiration of the order may also occur based
on circumstances described in the order.
6. The director of the department may issue an order
granting a retail dealer any number of subsequent extended
periods of compliance, if all of the following apply:
a. The prior order granting the retail dealer an extended
period of compliance is expiring or has expired.
b. The department grants the extended period of compliance
in the same manner as it would approve a new application.
7. a. This section shall be implemented on January 1, 2028.
b. This subsection is repealed January 2, 2028.
Sec. 24. RULE-MAKING —— EXTENSION OF SPECIAL USE GASOLINE
REQUIREMENTS. The department of natural resources shall adopt
rules pursuant to chapter 17A as necessary to allow retail
dealers to apply for an extended period of compliance and for
the department to receive and consider such applications as
provided in section 214A.43, prior to January 1, 2028.
Sec. 25. REPEAL. Section 214A.16, Code 2021, is repealed.
PART B
MISCELLANEOUS CHANGES
Sec. 26. Section 159A.6, subsection 1, paragraph c, Code
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2021, is amended to read as follows:
c. Develop standards for decals required pursuant to
section 214A.16 214A.36 , which shall be designed to promote
the advantages of using renewable fuels. The standards may be
incorporated within a model decal adopted by the office.
Sec. 27. 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.1A.
PART C
CODE ORGANIZATION
Sec. 28. CODE EDITOR DIRECTIVE.
1. The Code editor is directed to make the following
transfers:
a. Section 214A.7 to section 214A.2D.
b. Section 214A.8 to section 214A.2E.
c. Section 214A.13 to section 214A.2F.
2. The Code editor shall correct internal references in the
Code and in any enacted legislation as necessary due to the
enactment of this section.
Sec. 29. DIRECTIONS TO THE CODE EDITOR. The Code editor
is directed to divide Code chapter 214A as amended by this
division of this Act into subchapters and subchapter parts as
follows:
1. Subchapter I, including sections 214A.1 and 214A.1A.
2. Subchapter II, including sections 214A.2 through
214A.2F.
3. Subchapter III, including sections 214A.3 through
214A.30.
4. Subchapter IV, subdivided into part 1, including
sections 214A.31 through 214A.40; and part 2, including
sections 214A.41 through 214A.43.
PART D
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EFFECTIVE DATES
Sec. 30. EFFECTIVE DATE.
1. Except as provided in subsection 2, this division of this
Act takes effect October 1, 2021.
2. The section of this division of this Act enacting section
214A.1A takes effect upon enactment. However, rules adopted by
the department of agriculture and land stewardship pursuant to
that section shall not take effect prior to October 1, 2021.
3. The section of this division of this Act requiring the
department of natural resources to adopt rules as necessary
to allow retail dealers to apply for an extended period of
compliance pursuant to section 214A.43 and for the department
to consider those applications takes effect upon enactment.
However, the department is not required to adopt such rules
until January 1, 2027.
DIVISION II
RENEWABLE FUEL INFRASTRUCTURE
PART A
FINANCIAL INCENTIVES FOR RETAIL MOTOR FUEL SITES
Sec. 31. Section 159A.11, subsection 1, Code 2021, is
amended to read as follows:
1. “Biodiesel” , “biodiesel blended fuel” , “biodiesel
fuel” , “E-85 gasoline” , “ethanol” , “ethanol blended gasoline” ,
“gasoline” , “motor fuel” , “retail dealer” , and “retail motor fuel
site” , and “small retail dealer” mean the same as defined in
section 214A.1 .
Sec. 32. Section 159A.12, Code 2021, is amended to read as
follows:
159A.12 Classification Classifications of renewable types of
motor fuel —— gasoline and diesel fuel .
For purposes of this subchapter , all of the following apply
to types of motor fuel:
1. Gasoline, ethanol , and ethanol blended fuel and
biodiesel fuel gasoline shall be classified in the same manner
as provided in section 214A.2 .
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2. Diesel fuel, biodiesel fuel, and biodiesel blended fuel
shall be classified in the same manner as provided in section
214A.2.
Sec. 33. Section 159A.13, subsection 6, Code 2021, is
amended by striking the subsection.
Sec. 34. Section 159A.14, subsections 1 and 2, Code 2021,
are amended to read as follows:
1. The purpose of the program is to improve retail
motor fuel sites by installing, replacing, or converting
infrastructure to be used to store , blend, or and dispense , or
store, blend, and dispense, renewable fuel. The infrastructure
shall be ethanol infrastructure or biodiesel infrastructure.
a. (1) Ethanol infrastructure shall be designed and used
exclusively have the capacity to do any of the following:
(a) (1) Store and dispense E-15 gasoline ethanol classified
as E-100 or store ethanol blended gasoline classified as E-85
or higher . At least for the period beginning on September 16
and ending on May 31 of each year, the ethanol infrastructure
must be used to store and dispense E-15 gasoline as a
registered fuel recognized by the United States environmental
protection agency.
(b) (2) Store and dispense Dispense ethanol blended
gasoline classified as E-85 gasoline or higher .
(c) (3) Store , ethanol classified as E-100 or store
ethanol blended gasoline classified as E-85 or higher to blend ,
and dispense motor fuel ethanol or ethanol blended gasoline
classified as E-85 or higher from a motor fuel blender pump.
The ethanol infrastructure must be used for the storage of
ethanol or ethanol blended gasoline, or for blending ethanol
with gasoline. The ethanol infrastructure must at least
include a motor fuel blender pump which dispenses different
classifications of ethanol blended gasoline and allows E-85
gasoline to be dispensed at all times that the blender pump is
operating.
(2) b. (1) Biodiesel infrastructure shall be designed and
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used exclusively have the capacity to do any of the following:
(a) Store and dispense biodiesel or biodiesel blended fuel
classified as B-20 or higher .
(b) Blend or Store biodiesel classified as B-100 or
store biodiesel blended fuel classified as B-20 or higher,
to blend and dispense biodiesel blended fuel classified as
B-20 or higher from a motor fuel blender pump. The biodiesel
infrastructure must at least include a motor fuel blender pump
which dispenses different classifications of biodiesel blended
fuel and allows B-20 to be dispensed at all times that the
blender pump is operating.
(2) This paragraph “b” is repealed July 1, 2024.
b. c. The infrastructure must be part of the premises of
a retail motor fuel site operated by a retail dealer. The
infrastructure shall not include a tank vehicle.
2. A person may apply to the department to participate in
the program to receive financial incentives on a cost-share
basis as provided in this section . The department shall
forward the applications to the underground storage tank
fund board as required by that board for evaluation and
recommendation. The underground storage tank fund board may
rank the applications with comments and shall forward them
to the infrastructure board for approval or disapproval.
The department shall establish a deadline for submitting
applications by persons seeking to participate in the program.
The infrastructure board shall approve all applications to
improve existing retail motor fuel sites before approving
applications to improve any retail motor fuel site planned to
be constructed or expanded or in any stage of construction
or expansion. The infrastructure board shall then provide
a priority in approving applications submitted by eligible
persons who are small retail dealers. Upon request of the
department of natural resources, the department of agriculture
and land stewardship shall submit a statement to the department
of natural resources certifying a small retail dealer’s
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proposed financing of ethanol infrastructure as provided
in section 214A.43. The department shall award financial
incentives on a cost-share basis to an eligible person whose
application was approved by the infrastructure board.
Sec. 35. Section 159A.14, subsection 5, Code 2021, is
amended to read as follows:
5. An award of financial incentives to a participating
person shall be on a cost-share basis in the form of a grant.
To participate in the program, an eligible person must execute
a cost-share agreement with the department as approved by
the infrastructure board in which the person contributes
a percentage of the total costs related to improving the
retail motor fuel site. A cost-share agreement shall be for
a three-year period or a five-year period. A cost-share
agreement shall include provisions for standard financial
incentives or standard financial incentives and supplemental
financial incentives as provided in this subsection . The
infrastructure board may approve multiple improvements to the
same retail motor fuel site for the full amount available for
both ethanol infrastructure and biodiesel infrastructure so
long as the improvements for ethanol infrastructure and for
biodiesel infrastructure are made under separate cost-share
agreements.
a. (1) Except as provided in paragraph “b” , a A
participating person may be awarded standard financial
incentives to make improvements to a retail motor fuel site by
installing, replacing, or converting ethanol infrastructure as
provided in this section .
(1) The standard financial incentives awarded to a
participating person shall not exceed the following:
(a) For a three-year cost-share agreement, fifty percent of
the actual cost of making the improvement or thirty thousand
dollars, whichever is less.
(b) For be awarded to a participating person pursuant to a
five-year cost-share agreement , not to exceed seventy percent
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of the actual cost of making the improvement or fifty thousand
dollars, whichever is less.
(2) As part of the cost-share agreement, the participating
person must agree that for the period of the agreement the
ethanol infrastructure shall be used to store and dispense
ethanol or ethanol blended gasoline classified as E-15 or
higher or store, blend, and dispense ethanol or ethanol blended
gasoline classified as E-15 or higher.
(2) (3) The infrastructure board may approve multiple
awards of standard financial incentives to make improvements
to a retail motor fuel site so long as the total amount of the
awards for ethanol infrastructure or biodiesel infrastructure
does not exceed the limitations provided in subparagraph (1).
b. A participating person may be awarded standard financial
incentives to improve a retail motor fuel site by installing,
replacing, or converting biodiesel infrastructure as provided
in this section.
(1) The standard financial incentives shall be awarded to
a participating person pursuant to a three-year cost-share
agreement not to exceed fifty percent of the actual cost of
making the improvement or thirty thousand dollars, whichever
is less.
(2) As part of the cost-share agreement, the participating
person must agree that for the period of the agreement the
biodiesel infrastructure shall be used to store and dispense
biodiesel or biodiesel blended fuel classified as B-20 or
higher, or store, blend, and dispense biodiesel or biodiesel
blended fuel classified as B-20 or higher, from April 1 to
October 31 and biodiesel blended fuel classified as B-5 or
higher from November 1 to March 31.
(3) This paragraph “b” is repealed July 1, 2024.
c. (1) The infrastructure board may approve multiple
improvements to the same retail motor fuel site for the full
amount available for both ethanol infrastructure and biodiesel
infrastructure so long as the improvements for ethanol
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infrastructure and for biodiesel infrastructure are made under
separate cost-share agreements.
(2) This paragraph “c” is repealed July 1, 2024.
d. In addition to any standard financial incentives awarded
to a participating person under paragraph “a” this subsection ,
the participating person may be awarded supplemental financial
incentives to make improvements to a retail motor fuel site to
do any of the following:
(1) Upgrade or replace a dispenser which is part of
gasoline storage and dispensing infrastructure used to store
and dispense E-85 gasoline as provided in section 455G.31 .
The participating person is only eligible to be awarded the
supplemental financial incentives if the person installed the
dispenser not later than sixty days after July 27, 2011. The
supplemental financial incentives awarded to the participating
person shall not exceed seventy-five percent of the actual cost
of making the improvement or thirty thousand dollars, whichever
is less.
(2) To improve additional retail motor fuel sites owned or
operated by a participating person within a twelve-month period
as provided in the cost-share agreement. The supplemental
financial incentives shall be used for the installation of an
additional tank and associated infrastructure at each such
retail motor fuel site. A participating person may be awarded
supplemental financial incentives under this subparagraph
paragraph and standard financial incentives under paragraph
“a” this subsection to improve the same motor fuel site. The
supplemental financial incentives awarded to the participating
person shall not exceed twenty-four thousand dollars. The
participating person shall be awarded the supplemental
financial incentives on a cumulative basis according to the
schedule provided in this subparagraph paragraph , which shall
not exceed the following:
(a) (1) For the second retail motor fuel site, six thousand
dollars.
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(b) (2) For the third retail motor fuel site, six thousand
dollars.
(c) (3) For the fourth retail motor fuel site, six thousand
dollars.
(d) (4) For the fifth retail motor fuel site, six thousand
dollars.
Sec. 36. Section 159A.16, subsection 3, Code 2021, is
amended to read as follows:
3. Moneys in the renewable fuel infrastructure fund are
appropriated to the department exclusively to support and
market the renewable fuel infrastructure programs as provided
in sections 159A.14 and 159A.15 , and as allocated in financial
incentives by the renewable fuel infrastructure board created
in section 159A.13 .
a. (1) For each fiscal year of the period beginning July 1,
2021, and ending June 30, 2024, not more than one million two
hundred fifty thousand dollars shall be allocated to support
all of the following:
(a) The renewable fuel infrastructure program for retail
motor fuel sites as provided in section 159A.14 to finance
the installation, replacement, or conversion of biodiesel
infrastructure as provided in that section.
(b) The renewable fuel infrastructure program for biodiesel
terminal facilities as provided in section 159A.15.
(2) This paragraph “a” is repealed July 1, 2024.
b. Up to fifty For the fiscal year beginning July 1, 2021,
and for each fiscal year thereafter, not more than one hundred
thousand dollars shall be allocated each fiscal year to the
department to support the administration of the programs.
c. The For the fiscal year beginning July 1, 2021, and
for each fiscal year thereafter, the department may use up to
one and one-half percent of the program funds to market the
programs. Otherwise the moneys shall not be transferred, used,
obligated, appropriated, or otherwise encumbered except to
allocate as financial incentives under the programs.
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Sec. 37. RENEWABLE FUEL INFRASTRUCTURE AGREEMENTS. The
department of agriculture and land stewardship shall continue
to administer any outstanding cost-share agreement executed
prior to July 1, 2024, in which a participating person
was awarded a grant to improve a retail motor fuel site by
installing, replacing, or converting infrastructure to be used
to store and dispense biodiesel blended fuel or blend and
dispense biodiesel blended fuel as provided in section 159A.14,
as amended by this Act.
PART B
REQUIREMENTS FOR STORAGE AND DISPENSING INFRASTRUCTURE
Sec. 38. Section 323.4A, subsection 2, paragraphs a and b,
Code 2021, are amended to read as follows:
a. Installing, converting, or operating a storage tank
or a dispenser located on the distributor’s or dealer’s
business premises for use in storing or dispensing renewable
fuel. However, this paragraph does not apply to a dealer or
distributor whose business premises are leased from the other
party furnishing the renewable fuel.
b. Using a dispenser to dispense ethanol blended gasoline,
including gasoline with a specified blend or a range of blends
under chapter 214A , if the dispenser is approved as required by
the state fire marshal for dispensing the specified blend or
range of blends , including as provided in section 455G.31 .
Sec. 39. NEW SECTION . 455G.32 Definitions.
As used in this subchapter unless the context otherwise
requires:
1. “Department” means the department of natural resources.
2. “Ethanol blended gasoline” means the same as defined in
section 214A.1.
3. “Gasoline fuel storage and dispensing infrastructure” or
“infrastructure” means a motor fuel storage tank located above
ground or below ground, motor fuel pump, and a dispensing unit
necessary to store and dispense gasoline at a retail motor fuel
site as defined in section 214A.1, including but not limited to
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all associated equipment, dispensing units, dispensers, pumps,
pipes, hoses, tubes, lines, fittings, valves, filters, seals,
and covers.
4. “Retail dealer” means the same as defined in section
214A.1.
Sec. 40. NEW SECTION . 455G.33 Restrictions.
1. A retail dealer shall not install, replace, or convert
gasoline fuel storage and dispensing infrastructure unless the
installed, replaced, or converted infrastructure is capable of
storing and dispensing ethanol blended gasoline classified as
E-85 or higher.
2. The infrastructure must be all of the following:
a. Listed as compatible for use with ethanol blended
gasoline classified as E-85 or higher by an independent testing
laboratory or as approved by the manufacturer.
b. Approved by the department or state fire marshal subject
to conditions determined necessary by the department or state
fire marshal. The department or state fire marshal may waive
the requirement in paragraph “a” upon satisfaction that a
substitute requirement serves the same purpose.
Sec. 41. REPEAL. Section 455G.31, Code 2021, is repealed.
Sec. 42. EFFECTIVE DATE. This part of this division of this
Act takes effect October 1, 2021.
DIVISION III
TAXATION
PART A
INCOME TAX
Sec. 43. Section 422.11O, subsection 8, Code 2021, is
amended to read as follows:
8. This section is repealed on January 1, 2025 2028 .
Sec. 44. Section 422.11P, subsection 4, Code 2021, is
amended to read as follows:
4. For a retail dealer whose tax year is on a calendar year
basis, the retail dealer shall calculate the amount of the tax
credit by multiplying a designated rate by the retail dealer’s
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total biodiesel blended fuel gallonage as provided in section
452A.31 which qualifies under this subsection .
a. In order to qualify for the tax credit, the biodiesel
blended fuel must be classified as B-5 B-11 or higher as
provided in paragraph “b” this subsection .
b. Beginning January 1, 2018 2022 , the designated rate is
determined as follows:
(1) For biodiesel blended fuel classified as B-5 or higher
but not as high as B-11, the designated rate is three and
one-half cents.
(2) For biodiesel blended fuel classified as B-11 or higher,
the designated rate is five and one-half cents.
(1) (a) During the period beginning January 1 and ending
March 31, and during the period beginning November 1 and ending
December 31, for biodiesel blended fuel classified as B-11 or
higher up to but not including B-20, the designated rate is
four cents.
(b) During the period beginning January 1 and ending
December 31, for biodiesel blended fuel classified as B-20 or
higher up to but not including B-30, the designated rate is six
cents.
(c) During the period beginning January 1 and ending
December 31, for biodiesel blended fuel classified as B-30 or
higher, the designated rate is ten cents.
(2) A retail dealer is eligible to claim a tax credit
for a biodiesel blended fuel classified as higher than B-20
under subparagraph (1), subparagraph subdivision (b) or (c),
for each tax year beginning January 1 immediately following
the effective date of rules adopted by the department of
agriculture and land stewardship establishing standards for
that classification as provided in sections 214A.2.
Sec. 45. Section 422.11P, subsection 8, Code 2021, is
amended to read as follows:
8. This section is repealed January 1, 2025 2028 .
Sec. 46. Section 422.11Y, subsection 4, paragraph b, Code
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2021, is amended to read as follows:
b. The Beginning January 1, 2022, the designated rate of the
tax credit for the following three periods within each calendar
year is as follows:
(1) For the first period beginning January 1 and ending May
31, three four cents.
(2) For the second period beginning June 1 and ending
September 15, ten cents.
(3) For the third period beginning September 16 and ending
December 31, three cents.
Sec. 47. Section 422.11Y, subsection 9, Code 2021, is
amended to read as follows:
9. This section is repealed on January 1, 2025 2028 .
Sec. 48. Section 422.33, subsection 11B, paragraph c, Code
2021, is amended to read as follows:
c. This subsection is repealed on January 1, 2025 2028 .
Sec. 49. Section 422.33, subsection 11C, paragraph c, Code
2021, is amended to read as follows:
c. This subsection is repealed on January 1, 2025 2028 .
Sec. 50. Section 422.33, subsection 11D, paragraph c, Code
2021, is amended to read as follows:
c. This subsection is repealed on January 1, 2025 2028 .
Sec. 51. 2006 Iowa Acts, chapter 1142, section 49,
subsection 3, as amended by 2011 Iowa Acts, chapter 113,
section 20, and 2016 Iowa Acts, chapter 1106, section 6, is
amended to read as follows:
3. For a retail dealer who may claim an E-85 gasoline
promotion tax credit under section 422.11O or 422.33,
subsection 11B , as enacted in this Act and amended in
subsequent Acts, in calendar year 2024 2027 and whose tax
year ends prior to December 31, 2024 2027 , the retail dealer
may continue to claim the tax credit in the retail dealer’s
following tax year. In that case, the tax credit shall be
calculated in the same manner as provided in section 422.11O
or 422.33, subsection 11B , as enacted in this Act and amended
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in subsequent Acts, for the remaining period beginning on the
first day of the retail dealer’s new tax year until December
31, 2024 2027 . For that remaining period, the tax credit shall
be calculated in the same manner as a retail dealer whose tax
year began on the previous January 1 and who is calculating the
tax credit on December 31, 2024 2027 .
Sec. 52. 2011 Iowa Acts, chapter 113, section 31, as amended
by 2016 Iowa Acts, chapter 1106, section 10, is amended to read
as follows:
SEC. 31. TAX CREDIT AVAILABILITY. For a retail dealer
who may claim a biodiesel blended fuel promotion tax credit
under section 422.11P or 422.33, subsection 11C , as amended
in this Act and amended in subsequent Acts, in calendar year
2024 2027 , and whose tax year ends prior to December 31, 2024
2027 , the retail dealer may continue to claim the tax credit in
the retail dealer’s following tax year. In that case, the tax
credit shall be calculated in the same manner as provided in
section 422.11P or 422.33, subsection 11C , as amended in this
Act and amended in subsequent Acts, for the remaining period
beginning on the first day of the retail dealer’s new tax year
until December 31, 2024 2027 . For that remaining period, the
tax credit shall be calculated in the same manner as a retail
dealer whose tax year began on the previous January 1 and who
is calculating the tax credit on December 31, 2024 2027 .
Sec. 53. 2011 Iowa Acts, chapter 113, section 37, as amended
by 2016 Iowa Acts, chapter 1106, section 3, is amended to read
as follows:
SEC. 37. TAX CREDIT AVAILABILITY. For a retail dealer who
may claim an E-15 plus gasoline promotion tax credit under
section 422.11Y or 422.33, subsection 11D , as enacted in this
Act and amended in subsequent Acts, in calendar year 2024
2027 , and whose tax year ends prior to December 31, 2024 2027 ,
the retail dealer may continue to claim the tax credit in the
retail dealer’s following tax year. In that case, the tax
credit shall be calculated in the same manner as provided in
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section 422.11Y or 422.33, subsection 11D , as enacted in this
Act and amended in subsequent Acts, for the remaining period
beginning on the first day of the retail dealer’s new tax year
until December 31, 2024 2027 . For that remaining period, the
tax credit shall be calculated in the same manner as a retail
dealer whose tax year began on the previous January 1 and who
is calculating the tax credit on December 31, 2024 2027 .
PART B
MOTOR FUEL TAX
Sec. 54. NEW SECTION . 452A.2A Classification of types of
motor fuel —— gasoline and diesel fuel.
For purposes of this subchapter, all of the following apply
to types of motor fuel:
1. Gasoline, ethanol, and ethanol blended gasoline shall be
classified in the same manner as provided in section 214A.2.
2. Diesel fuel, biodiesel fuel, and biodiesel blended fuel
shall be classified in the same manner as provided in section
214A.2.
Sec. 55. Section 452A.8, subsection 2, paragraph a, Code
2021, is amended by adding the following new subparagraph:
NEW SUBPARAGRAPH . (3) The gallonage of gasoline or diesel
fuel withdrawn from a terminal by a licensee to be blended
with a biofuel after it is withdrawn from the terminal to the
extent the tax rate on the gasoline or diesel fuel exceeds the
tax rate which would be due on the ethanol blended gasoline or
biodiesel blended fuel.
Sec. 56. Section 452A.12, subsection 2, Code 2021, is
amended to read as follows:
2. A person while transporting motor fuel or undyed special
fuel from a refinery or marine or pipeline terminal in this
state or from a point outside this state over the highways
of this state in service other than that under subsection
1 shall carry in the vehicle a loading invoice showing the
name and address of the seller or consignor, the date and
place of loading, and the kind and quantity of motor fuel or
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special fuel loaded, together with invoices showing the kind
and quantity of each delivery and the name and address of each
purchaser or consignee. An invoice carried pursuant to this
subsection for ethanol blended gasoline or biodiesel blended
fuel shall state its designation classification as provided in
section 214A.2 .
Sec. 57. Section 452A.31, subsection 2, paragraph a,
subparagraph (1), unnumbered paragraph 1, Code 2021, is amended
to read as follows:
The total ethanol blended gasoline gallonage which is
the retail dealer’s total number of gallons of ethanol
blended gasoline and which includes all of the following
subclassifications classifications :
Sec. 58. Section 452A.31, subsection 2, paragraph a,
subparagraph (1), subparagraph division (c), Code 2021, is
amended to read as follows:
(c) The total E-15 gasoline gallonage which is the total
number of gallons of ethanol blended gasoline classified as
E-15 or higher , up to but not including E-85 gasoline.
Sec. 59. Section 452A.31, subsection 2, paragraph a,
subparagraph (2), Code 2021, is amended to read as follows:
(2) The total nonblended gasoline gallonage which is
the total number of gallons of nonblended ethanol gasoline
classified as E-0 .
Sec. 60. Section 452A.31, subsection 3, paragraph a,
subparagraphs (2) and (3), Code 2021, are amended to read as
follows:
(2) The total B-11 gallonage which is the total number of
gallons of biodiesel blended fuel classified as B-11 or higher
up to but not including B-20 .
(3) The total nonblended diesel fuel gallonage which is the
total number of gallons of diesel fuel which is not biodiesel
or biodiesel blended fuel classified as B-0 .
Sec. 61. Section 452A.31, subsection 3, paragraph a, Code
2021, is amended by adding the following new subparagraphs:
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NEW SUBPARAGRAPH . (03) The total B-20 gallonage which
is the total number of gallons of biodiesel blended fuel
classified as B-20 or higher up to but not including B-30.
NEW SUBPARAGRAPH . (003) The total B-30 gallonage which
is the total number of gallons of biodiesel blended fuel
classified as B-30 or higher.
Sec. 62. Section 452A.31, subsection 4, paragraph a,
subparagraph (1), unnumbered paragraph 1, Code 2021, is amended
to read as follows:
The aggregate ethanol blended gasoline gallonage
which is the aggregate total number of gallons of ethanol
blended gasoline and which includes all of the following
subclassifications classifications :
Sec. 63. Section 452A.31, subsection 4, paragraph a,
subparagraph (1), subparagraph division (c), Code 2021, is
amended to read as follows:
(c) The aggregate E-15 gasoline gallonage which is the
aggregate total number of gallons of ethanol blended gasoline
classified as E-15 or higher , up to but not including E-85
gasoline.
Sec. 64. Section 452A.31, subsection 4, paragraph a,
subparagraph (2), Code 2021, is amended to read as follows:
(2) The aggregate nonblended gasoline gallonage, which is
the aggregate number of gallons of nonblended ethanol gasoline
classified as E-0 .
Sec. 65. Section 452A.31, subsection 5, paragraph a,
subparagraphs (2) and (3), Code 2021, are amended to read as
follows:
(2) The aggregate B-11 gallonage which is the aggregate
total number of gallons of biodiesel blended fuel classified as
B-11 or higher up to but not including B-20 .
(3) The aggregate nonblended diesel fuel gallonage which
is the aggregate number of gallons of diesel fuel which is not
biodiesel or biodiesel blended fuel classified as B-0 .
Sec. 66. Section 452A.31, subsection 5, paragraph a, Code
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2021, is amended by adding the following new subparagraphs:
NEW SUBPARAGRAPH . (03) The aggregate B-20 gallonage which
is the aggregate total number of gallons of biodiesel blended
fuel classified as B-20 or higher up to but not including B-30.
NEW SUBPARAGRAPH . (003) The aggregate B-30 gallonage which
is the aggregate total number of gallons of biodiesel blended
fuel classified as B-30 or higher.
Sec. 67. Section 452A.33, subsection 1, paragraph a, Code
2021, is amended to read as follows:
a. Each retail dealer shall file a report with the
department stating its total motor fuel gallonage for and its
total gallonage for each type of motor fuel, including gasoline
and diesel fuel, during a determination period as follows:
(1) Its total gasoline gallonage and its total
ethanol gallonage, including for each classification and
subclassification as provided in section 452A.31 .
(2) Its total diesel fuel gallonage and its total
biodiesel gallonage, including for each classification and
subclassification as provided in section 452A.31 .
Sec. 68. Section 452A.33, subsection 1, paragraph b,
subparagraphs (1) and (2), Code 2021, are amended to read as
follows:
(1) The information submitted on a company-wide basis shall
include the total motor fuel gallonage, including for each type
and classification and subclassification, sold and dispensed
by the retail dealer as provided in paragraph “a” for all
retail motor fuel sites from which the retail dealer sells and
dispenses motor fuel.
(2) The information submitted on a site-by-site basis shall
include the total motor fuel gallonage, including for each type
and classification and subclassification, sold and dispensed by
the retail dealer as provided in paragraph “a” separately for
each retail motor fuel site from which the retail dealer sells
and dispenses motor fuel.
Sec. 69. Section 452A.33, subsection 1, paragraph c, Code
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2021, is amended to read as follows:
c. The retail dealer shall prepare and submit file the
report with the department in a manner and according to
procedures required by the department in compliance with
section 452A.61 . However, the department may require that the
retail dealer file the report with the department by electronic
transmission. The department may require that a retail
dealers report to dealer file the report with the department
on an annual, quarterly, or monthly basis. The department,
upon application by a retail dealer, may grant a reasonable
extension of time to file the report. A retail dealer who
fails to file the report as required in this section or who
fails to maintain records required to file the report shall be
subject to a civil penalty of not more than one hundred dollars
per occurrence which shall be deposited in the general fund of
the state.
PART C
EFFECTIVE DATE
Sec. 70. EFFECTIVE DATE. This division of this Act takes
effect January 1, 2022.
DIVISION IV
RENEWABLE FUEL USE BY STATE MOTOR VEHICLES
Sec. 71. Section 8A.362, subsection 3, paragraph b, Code
2021, is amended by striking the paragraph and inserting in
lieu thereof the following:
b. The director shall provide for the purchase and operation
of motor vehicle fuel and motor vehicles in the manner provided
in section 8A.362A.
Sec. 72. NEW SECTION . 8A.362A Definitions and
classifications.
1. As used in section 8A.362B and 8A.362C, unless the
context otherwise requires:
a. “Biodiesel blended fuel” means the same as defined in
section 214A.1.
b. “Biofuel” means the same as defined in section 214A.1.
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c. “Determination period” means any twelve-month period
beginning January 1 and ending December 31.
d. “Ethanol blended gasoline” means the same as defined in
section 214A.1.
e. “Renewable fuel” means ethanol blended gasoline or
biodiesel blended fuel that meets the standards for that type
of motor fuel as provided in section 214A.2.
2. For purposes of sections 8A.362B and 8A.362C, a renewable
fuel shall be classified in the same manner as provided in
section 214A.2.
Sec. 73. NEW SECTION . 8A.362B Motor vehicle purchases ——
renewable fuels.
1. A gasoline-powered motor vehicle, or a diesel-powered
motor vehicle, operating under section 8A.362, shall be powered
using the highest possible classification of renewable fuel if
all of the following apply:
a. The manufacturer of the motor vehicle or the United
States environmental protection agency expressly states that
the classification of renewable fuel is compatible with the
motor vehicle’s normal operation.
b. That classification of renewable fuel is commercially
available in the region where the motor vehicle is being
operated.
c. No emergency situation exists that requires the immediate
use of a motor fuel regardless of whether it has been blended
with a biofuel.
2. If the highest possible classification of renewable
fuel is able to be used to power a motor vehicle as provided
in subsection 1, a state-issued credit card shall not be
used to purchase motor fuel other than the highest possible
classification of motor fuel.
3. A motor vehicle subject to this section shall be
affixed with a brightly colored, highly visible sticker which
notifies the traveling public that the motor vehicle is powered
using the highest possible classification of renewable fuel.
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However, the sticker is not required to be affixed to an
unmarked vehicle used for purposes of providing law enforcement
or security.
4. As part of the department’s competitive bidding
procedure for the purchase of a diesel-powered motor vehicle,
the director shall require that a bidder certify that the
motor vehicle’s manufacturer expressly states that the motor
vehicle is capable of being powered using biodiesel blended
fuel classified as B-20 or higher.
Sec. 74. NEW SECTION . 8A.362C Motor vehicle purchases ——
renewable fuels —— reports.
1. The department shall compile information regarding
the department’s compliance with section 8A.362B during the
previous determination period. The information shall include
all of the following:
a. Of the motor vehicles used to routinely travel on the
state’s highways that are powered using gasoline, all of the
following:
(1) The total number of such motor vehicles according to
model year.
(2) The total number of such motor vehicles according to
model year that are capable of being powered using ethanol
blended gasoline classified as E-15 and E-85 according to the
express warranty of the motor vehicle’s manufacturer.
(3) The total number of gallons of ethanol blended gasoline
classified as E-15, and the total number of gallons of ethanol
blended gasoline classified as E-85, purchased during the
preceding determination period, to the extent such information
may be practically obtained.
b. Of the motor vehicles used to routinely travel on the
state’s highways that are powered using diesel fuel, all of the
following:
(1) The total number of such motor vehicles according to
model year.
(2) The total number of such motor vehicles according to
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model year that are capable of being powered using biodiesel
blended fuel classified as B-20 according to the express
warranty of the motor vehicle’s manufacturer.
(3) The total number of gallons of biodiesel blended fuel
classified as B-20 purchased during the preceding determination
period, to the extent such information may be practically
obtained.
2. The department of administrative services shall
prepare a state fleet renewable fuels compliance report which
shall consolidate information compiled by the department
under subsection 1 together with information compiled by
the commission for the blind pursuant to section 216B.3,
institutions governed by the state board of regents pursuant to
section 262.25A, the department of transportation pursuant to
section 307.21, and the department of corrections pursuant to
section 904.312A. The department of administrative services
shall submit the state fleet renewable fuels compliance report
to the governor and general assembly not later than March 1 of
each year.
Sec. 75. Section 216B.3, subsection 16, paragraph a, Code
2021, is amended by striking the paragraph and inserting in
lieu thereof the following:
a. Provide for the purchase and operation of motor vehicles
powered by renewable fuel in the same manner required for the
director of the department of administrative services pursuant
to section 8A.362B. The commission shall compile information
regarding compliance with the provisions of this paragraph in
the same manner as the department of administrative services
pursuant to section 8A.362C. The commission shall cooperate
with the department of administrative services in preparing the
annual state fleet renewable fuels compliance report regarding
compliance with this paragraph as provided in section 8A.362C.
Sec. 76. Section 262.25A, subsection 2, Code 2021, is
amended by striking the subsection and inserting in lieu
thereof the following:
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2. An institution shall provide for the purchase and
operation of motor vehicles powered by renewable fuel in
the same manner required for the director of the department
of administrative services pursuant to section 8A.362B. An
institution shall compile information regarding compliance
with the provisions of this subsection in the same manner as
the department of administrative services pursuant to section
8A.362C. The state board of regents shall cooperate with
the department of administrative services in preparing the
annual state fleet renewable fuels compliance report regarding
compliance with this subsection as provided in section 8A.362C.
Sec. 77. Section 307.21, subsection 4, Code 2021, is amended
by striking the subsection and inserting in lieu thereof the
following:
4. The administrator shall provide for the purchase and
operation of motor vehicles powered by renewable fuel in
the same manner required for the director of the department
of administrative services pursuant to section 8A.362B.
The department of transportation shall compile information
regarding compliance with the provisions of this subsection in
the same manner as the department of administrative services
pursuant to section 8A.362C. The department of transportation
shall cooperate with the department of administrative services
in preparing the annual state fleet renewable fuels compliance
report regarding compliance with this subsection as provided
in section 8A.362C.
Sec. 78. Section 904.312A, subsection 1, Code 2021, is
amended by striking the subsection and inserting in lieu
thereof the following:
1. The department of corrections shall provide for the
purchase and operation of motor vehicles powered by renewable
fuel in the same manner required for the director of the
department of administrative services pursuant to section
8A.362B. The department of corrections shall compile
information regarding compliance with the provisions of
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this subsection in the same manner as the department of
administrative services pursuant to section 8A.362C. The
department of corrections shall cooperate with the department
of administrative services in preparing the annual state fleet
renewable fuels compliance report regarding compliance with
this subsection as provided in section 8A.362C.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
GENERAL. This bill provides for motor fuel and specifically
renewable fuel used to power motor vehicles, including by
providing for standards and restrictions, infrastructure, tax
credits, and requirements for state agencies.
MOTOR FUEL STANDARDS AND CLASSIFICATIONS. The bill
provides for the regulation of motor fuel advertised for
sale or sold to the public by a retail dealer at a retail
motor fuel site (retail site). Motor fuel regulations are
administered and enforced by the department of agriculture
and land stewardship (DALS) (Code chapter 214A). The bill
provides for two types of motor fuel, including gasoline and
clear (undyed) diesel fuel and their respective components.
This includes a renewable fuel which contains a biofuel. For
gasoline, the biofuel is alcohol (ethanol) and for diesel fuel,
the biofuel is a form of plant oil or animal fat (biofuel)
(amended Code section 214A.1). The amount of a biofuel
contained as part of either type of motor fuel is classified
by percentage. Ethanol blended gasoline is classified as
either E-xx (e.g., E-10 equaling between 9 and 10 percent
ethanol by volume or E-85 equaling between 70 and 85 percent
ethanol) and biodiesel blended diesel fuel is classified as
B-xx (e.g., B-5 equaling five percent biodiesel by volume)
(see amended Code section 214A.2). The bill distinguishes
between standard use gasoline and special use gasoline as well
as standard use diesel fuel and special use diesel fuel based
on a designated classification or range of classifications. A
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motor fuel designated as special use does not meet a minimum
classification while a motor fuel designated as standard use
does meet that classification.
PROHIBITIONS. A retail dealer is prohibited from
advertising for sale or selling special use gasoline which is
nonblended gasoline classified as E-0 unless it is premium
grade gasoline with an octane grade of 91 or higher (amended
Code section 214A.2 and new Code section 214A.31). Beginning
January 1, 2028, a retail dealer is prohibited from advertising
for sale special use gasoline classified as E-10 or higher up
to but not including E-15 except if used to power certain types
of engines (new Code section 214A.32). On and after January
1, 2028, a retail dealer is prohibited from advertising for
sale or selling gasoline from more than two dispensing units
at a retail site, unless the retail dealer advertises for sale
standard use gasoline classified as E-15 or higher from at
least one of those dispensing units (new Code section 214A.33).
A retail dealer is prohibited from advertising for sale clear
diesel fuel during the period beginning April 1 and ending
October 31 of each year, unless it is classified as B-11 or
higher, which is also subject to certain exceptions (e.g., an
engine used to power an off-road vehicle) (new Code section
214A.34).
The bill prohibits the false advertising of a motor fuel,
including by designating a false classification (amended Code
section 214A.3). It requires the labeling of motor fuel pumps
(dispensing units) which must state whether the motor fuel
being dispensed is a special use gasoline or special use diesel
fuel and indicate what types of engines may be powered using
that type and classification of motor fuel. It eliminates a
provision that requires that a decal be placed on a dispensing
unit notifying the traveling public that gasoline is blended
with ethanol (repealed Code section 214A.16 and new Code
sections 214A.35 and 214A.36).
ORDER FOR A WAIVER, SUSPENSION, OR EXTENSION. The bill
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authorizes the governor or secretary of agriculture to issue
an order temporarily waiving a requirement that a retail
dealer comply with the special use requirements if there is
credible evidence that the retail dealer has not been able to
reasonably obtain the required classification of renewable fuel
(new Code section 214A.41). The governor may issue an order
suspending compliance for all retail dealers in the state or
a geographic segment of the state if the governor determines
there is inadequate infrastructure to store or dispense
standard use gasoline or standard use diesel fuel or it is not
commercially feasible for the retail dealers to obtain the
required classification (new Code section 214A.42). Beginning
January 1, 2028, the department of natural resources (DNR) may
issue an order extending the period that a small retail dealer
operating fewer than 10 retail sites must comply with the E-15
standard use gasoline requirement based on the incompatibility
of the infrastructure (new Code section 214A.43).
APPLICABLE PENALTIES AND DISCIPLINARY ACTION. 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 a civil proceeding
against the person for at least $100 but not more than $1,000
for each violation. The bill also provides that a retail
dealer’s license issued under Code chapter 214 regulating
weights and measures may be suspended or revoked (new Code
section 214.2A and amended Code section 214A.11).
RENEWABLE FUEL INFRASTRUCTURE —— FINANCING PROGRAM. The
bill provides for the storage, blending, and dispensing of
types of motor fuel containing a biofuel. This includes two
programs administered by DALS providing state financing in
the form of an award of cost-share moneys under an agreement
executed by DALS and a participating person who is either a
retail dealer (amended Code section 159A.14) or a biodiesel
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terminal facility (Code section 159A.15). For a retail
dealer, the program supports the installation, replacement, or
conversion of renewable fuel compatible infrastructure at a
retail site (amended Code section 159A.14). The moneys must
be used to support improvements used to store biofuel, store
and dispense a renewable fuel, or store, blend, and dispense
a renewable fuel. The bill provides the infrastructure must
be capable of storing and dispensing E-85 or higher or B-20
or higher and the infrastructure must be used to store and
dispense E-15 or to store and dispense B-20 from April 1 to
October 31 and B-5 from November 1 to March 31. A preference is
provided to improve existing retail sites and to small retail
dealers. The financial incentives for biodiesel improvements
must be awarded pursuant to a three-year cost-share agreement
not to exceed 50 percent of the cost of the improvement or
$30,000, whichever is less. The bill provides for how moneys
in the renewable fuel infrastructure fund are allocated to
support either the program for retail dealers or biodiesel
terminal facilities (amended Code section 159A.15). The
provisions awarding financial assistance to retail dealers to
support biodiesel infrastructure at retail sites are eliminated
on July 1, 2024.
ETHANOL INFRASTRUCTURE —— REQUIREMENTS. The bill
establishes requirements for the installation, replacement, or
conversion of gasoline storage and dispensing infrastructure
at retail sites. Such infrastructure must be compatible with
E-85 in compliance with standards required by an independent
testing laboratory or the manufacturer, and either the DNR or
the state fire marshal (repealed Code section 455G.31 and new
Code sections 455G.32 and 455G.33).
INCOME TAX CREDITS. The bill extends the expiration date
of three renewable fuel tax programs from January 1, 2025, to
January 1, 2028, including: (1) the E-85 gasoline promotion
tax credit (amended Code sections 422.11O and 422.33(11B)), (2)
the biodiesel blended fuel tax credit (Code sections 422.11P
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and 422.33(11C)), and (3) the E-15 plus gasoline promotion tax
credit (amended Code sections 422.11Y and 422.33(11D)). The
provisions are administered and enforced by the department of
revenue (DOR). In each case, the tax credit is calculated by
taking the number of gallons of renewable fuel sold multiplied
by a designated rate (rate). The rate may differ depending
upon the time of year or its classification. Under the bill,
for biodiesel blended fuel classified as B-11 or higher up to
but not including B-20 during the period beginning January 1
and ending March 31 and during the period beginning November
1 and ending December 31, the rate is 4 cents. During the
period beginning January 1 and ending December 31, for
biodiesel blended fuel classified as B-20 or higher up to but
not including B-30, the rate is 6 cents. During the period
beginning January 1 and ending December 31, for biodiesel
blended fuel classified as B-30 or higher, the rate is 10
cents. For ethanol blended gasoline classified as E-15 or
higher up to but not including E-85, the rate is 4 cents.
MOTOR FUEL TAXES. The bill amends provisions determining
the tax liability of a supplier or importer of motor fuel
(amended Code section 452A.8). The bill provides a deduction
to the extent the tax rate on gallonage withdrawn for purposes
of blending with biofuel exceeds the rate which would be due on
the ethanol blended gasoline or biodiesel blended fuel.
REPORTING REQUIREMENTS. The bill amends provisions
requiring retail dealers to report to DOR the total number
of gallons of motor fuel sold and dispensed at sites during
each year, including the types and classifications of motor
fuel (amended Code sections 452A.31 and 452A.32). Based on
information in those reports, DOR prepares a report compiling
that information on an aggregate basis. The bill makes changes
in terminology and requires that the information include the
total and aggregate number of gallons of biodiesel blended
fuel classified as B-20 or higher up to but not including B-30
and biodiesel blended fuel classified as B-30 or higher. The
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bill provides procedures for filing a retail dealer report and
subjects a retail dealer who fails to file a report to a civil
penalty of not more than $100.
USE OF RENEWABLE FUEL BY THE STATE MOTOR VEHICLE FLEET.
Current law requires state and local governments to power
motor vehicles using any classification of renewable fuel
(E-10 or B-1). A state-issued credit card cannot be used
to purchase motor fuel other than renewable fuel unless it
is not commercially available or there is an emergency. The
motor vehicle being powered by motor fuel must be affixed with
a sticker that notifies the traveling public that the motor
vehicle is powered using renewable fuel. The bill provides
that a motor vehicle which is part of the state government
fleet must be powered using the highest classification of
renewable fuel available so long as (1) it is warranted by
the motor vehicle’s manufacturer, (2) that classification is
available, and (3) an emergency situation does not exist.
The bill also requires a state entity to revise its bidding
procedures as necessary to account for the purchase of motor
vehicles powered by biodiesel blended fuel classified as
B-20 or higher. The state entities involved include the
department of administrative services (new Code sections
8A.362A, 8A.362B, and 8A.362C), the commission for the blind
(amended Code section 216B.3), institutions governed by the
board of regents (amended Code section 262.25A), the department
of transportation (amended Code section 307.21), and the
department of corrections (amended Code section 904.312A).
The bill requires the department of administrative services,
in cooperation with the other entities operating motor
vehicles, to prepare an annual report to be submitted to the
governor and general assembly providing information regarding
the number of state motor vehicles powered using motor fuel,
including gasoline and diesel fuel, the number of those motor
vehicles capable of being powered using E-15 and E-85 or B-20,
and the number of gallons of renewable fuel purchased.
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EFFECTIVE DATES. The provisions of the bill relating
to motor fuel standards and classifications and associated
prohibitions generally take effect October 1, 2021. However,
provisions relating to rulemaking by DALS and DNR take effect
upon enactment. The provisions relating to renewable fuel
infrastructure take effect July 1, 2021. The provisions
relating to gasoline fuel storage and dispensing infrastructure
take effect October 1, 2021. The provisions relating to tax
credits and motor fuel taxes take effect January 1, 2022.
The provisions relating to renewable fuel use by state motor
vehicles take effect July 1, 2021.
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