Bill Text: IA SF2224 | 2011-2012 | 84th General Assembly | Introduced

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Bill Title: A bill for an act relating to funding for Iowa roads, including by increasing the excise tax on motor fuel and special fuel used in motor vehicles, providing for the use of certain revenues, providing for related studies, evaluations, and reports, and including effective date provisions. (Formerly SSB 3141.)

Spectrum: Committee Bill

Status: (Introduced - Dead) 2012-02-28 - Subcommittee, McCoy, Dotzler, and Feenstra. S.J. 395. [SF2224 Detail]

Download: Iowa-2011-SF2224-Introduced.html

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Senate File 2224 - Introduced
SENATE FILE 2224
BY COMMITTEE ON TRANSPORTATION
(SUCCESSOR TO SSB 3141)
A BILL FOR
An Act relating to funding for Iowa roads, including by
increasing the excise tax on motor fuel and special fuel
used in motor vehicles, providing for the use of certain
revenues, providing for related studies, evaluations, and
reports, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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S.F. 2224
DIVISION I
MOTOR FUEL TAX
Section 1. Section 312.2, Code 2011, is amended by adding
the following new subsection:
NEW SUBSECTION . 21. a. The treasurer of state, before
making the allotments provided for in this section, shall
credit monthly from the road use tax fund to the TIME-21 fund
created in section 312A.2 the revenue accruing to the road use
tax fund from the excise tax on motor fuel and special fuel for
motor vehicles in the amount equal to the revenues collected
as follows:
(1) For the period beginning January 1, 2013, and ending
December 31, 2013, the following amounts:
(a) The amount of excise tax collected under section 452A.3,
subsection 1, paragraph “c” , from five cents per gallon.
(b) The amount of excise tax on special fuel for diesel
engines of motor vehicles, other than biodiesel blended fuel
classified as B-10 or higher, collected under section 452A.3,
subsection 3, paragraph “a” , subparagraph (2), from five cents
per gallon.
(2) Beginning January 1, 2014, the following amounts:
(a) The amount of excise tax collected under section 452A.3,
subsection 1, paragraph “d” , or section 452A.3, subsection 1A,
from ten cents per gallon.
(b) The amount of excise tax on special fuel for diesel
engines of motor vehicles, other than biodiesel blended fuel
classified as B-10 or higher, collected under section 452A.3,
subsection 3, paragraph “a” , subparagraph (3), from ten cents
per gallon.
b. This subsection is repealed June 30, 2028.
Sec. 2. Section 452A.3, subsection 1, paragraph b,
unnumbered paragraph 1, Code 2011, is amended to read as
follows:
The Prior to January 1, 2013, the rate for the excise tax
shall be as follows:
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S.F. 2224
Sec. 3. Section 452A.3, subsection 1, Code 2011, is amended
by adding the following new paragraphs:
NEW PARAGRAPH . c. For the period beginning January 1, 2013,
and ending December 31, 2013, the rate for the excise tax shall
be as follows:
(1) If the distribution percentage is not greater than
fifty percent, the rate shall be twenty-four cents for ethanol
blended gasoline and twenty-five cents for motor fuel other
than ethanol blended gasoline.
(2) If the distribution percentage is greater than fifty
percent but not greater than fifty-five percent, the rate
shall be twenty-four cents for ethanol blended gasoline and
twenty-five and one-tenth cents for motor fuel other than
ethanol blended gasoline.
(3) If the distribution percentage is greater than
fifty-five percent but not greater than sixty percent, the rate
shall be twenty-four cents for ethanol blended gasoline and
twenty-five and three-tenths cents for motor fuel other than
ethanol blended gasoline.
(4) If the distribution percentage is greater than sixty
percent but not greater than sixty-five percent, the rate
shall be twenty-four cents for ethanol blended gasoline and
twenty-five and five-tenths cents for motor fuel other than
ethanol blended gasoline.
(5) If the distribution percentage is greater than
sixty-five percent but not greater than seventy percent, the
rate shall be twenty-four cents for ethanol blended gasoline
and twenty-five and seven-tenths cents for motor fuel other
than ethanol blended gasoline.
(6) If the distribution percentage is greater than seventy
percent but not greater than seventy-five percent, the rate
shall be twenty-four cents for ethanol blended gasoline and
twenty-six cents for motor fuel other than ethanol blended
gasoline.
(7) If the distribution percentage is greater than
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S.F. 2224
seventy-five percent but not greater than eighty percent, the
rate shall be twenty-four and three-tenths cents for ethanol
blended gasoline and twenty-five and eight-tenths cents for
motor fuel other than ethanol blended gasoline.
(8) If the distribution percentage is greater than eighty
percent but not greater than eighty-five percent, the rate
shall be twenty-four and five-tenths cents for ethanol blended
gasoline and twenty-five and seven-tenths cents for motor fuel
other than ethanol blended gasoline.
(9) If the distribution percentage is greater than
eighty-five percent but not greater than ninety percent, the
rate shall be twenty-four and seven-tenths cents for ethanol
blended gasoline and twenty-five and four-tenths cents for
motor fuel other than ethanol blended gasoline.
(10) If the distribution percentage is greater than ninety
percent but not greater than ninety-five percent, the rate
shall be twenty-four and nine-tenths cents for ethanol blended
gasoline and twenty-five and one-tenth cents for motor fuel
other than ethanol blended gasoline.
(11) If the distribution percentage is greater than
ninety-five percent, the rate shall be twenty-five cents for
ethanol blended gasoline and twenty-five cents for motor fuel
other than ethanol blended gasoline.
NEW PARAGRAPH . d. For the period beginning January 1, 2014,
and ending June 30, 2022, the rate for the excise tax shall be
as follows:
(1) If the distribution percentage is not greater than
fifty percent, the rate shall be twenty-nine cents for ethanol
blended gasoline and thirty cents for motor fuel other than
ethanol blended gasoline.
(2) If the distribution percentage is greater than fifty
percent but not greater than fifty-five percent, the rate shall
be twenty-nine cents for ethanol blended gasoline and thirty
and one-tenth cents for motor fuel other than ethanol blended
gasoline.
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S.F. 2224
(3) If the distribution percentage is greater than
fifty-five percent but not greater than sixty percent, the rate
shall be twenty-nine cents for ethanol blended gasoline and
thirty and three-tenths cents for motor fuel other than ethanol
blended gasoline.
(4) If the distribution percentage is greater than sixty
percent but not greater than sixty-five percent, the rate shall
be twenty-nine cents for ethanol blended gasoline and thirty
and five-tenths cents for motor fuel other than ethanol blended
gasoline.
(5) If the distribution percentage is greater than
sixty-five percent but not greater than seventy percent, the
rate shall be twenty-nine cents for ethanol blended gasoline
and thirty and seven-tenths cents for motor fuel other than
ethanol blended gasoline.
(6) If the distribution percentage is greater than seventy
percent but not greater than seventy-five percent, the rate
shall be twenty-nine cents for ethanol blended gasoline and
thirty-one cents for motor fuel other than ethanol blended
gasoline.
(7) If the distribution percentage is greater than
seventy-five percent but not greater than eighty percent, the
rate shall be twenty-nine and three-tenths cents for ethanol
blended gasoline and thirty and eight-tenths cents for motor
fuel other than ethanol blended gasoline.
(8) If the distribution percentage is greater than eighty
percent but not greater than eighty-five percent, the rate
shall be twenty-nine and five-tenths cents for ethanol blended
gasoline and thirty and seven-tenths cents for motor fuel other
than ethanol blended gasoline.
(9) If the distribution percentage is greater than
eighty-five percent but not greater than ninety percent, the
rate shall be twenty-nine and seven-tenths cents for ethanol
blended gasoline and thirty and four-tenths cents for motor
fuel other than ethanol blended gasoline.
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S.F. 2224
(10) If the distribution percentage is greater than ninety
percent but not greater than ninety-five percent, the rate
shall be twenty-nine and nine-tenths cents for ethanol blended
gasoline and thirty and one-tenth cents for motor fuel other
than ethanol blended gasoline.
(11) If the distribution percentage is greater than
ninety-five percent, the rate shall be thirty cents for ethanol
blended gasoline and thirty cents for motor fuel other than
ethanol blended gasoline.
Sec. 4. Section 452A.3, subsection 1A, Code 2011, is amended
to read as follows:
1A. Except as otherwise provided in this section and in this
division , after June 30, 2012 2022 , an excise tax of twenty
thirty cents is imposed on each gallon of motor fuel used for
any purpose for the privilege of operating motor vehicles in
this state.
Sec. 5. Section 452A.3, subsection 3, Code 2011, is amended
to read as follows:
3. a. For the privilege of operating motor vehicles or
aircraft in this state, there is imposed an excise tax on the
use of special fuel in a motor vehicle or aircraft. The
(1) Prior to January 1, 2013, the tax rate on special fuel
for diesel engines of motor vehicles is twenty-two and one-half
cents per gallon.
(2) For the period beginning January 1, 2013, and ending
December 31, 2013, the tax rate on biodiesel blended fuel
classified as B-10 or higher for diesel engines of motor
vehicles is twenty-two and one-half cents per gallon and the
tax rate on special fuel for diesel engines of motor vehicles
other than biodiesel blended fuel classified as B-10 or higher
is twenty-seven and one-half cents per gallon.
(3) Beginning January 1, 2014, the tax rate on biodiesel
blended fuel classified as B-10 or higher for diesel engines
of motor vehicles is twenty-two and one-half cents per gallon
and the tax rate on special fuel for diesel engines of motor
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S.F. 2224
vehicles other than biodiesel blended fuel classified as B-10
or higher is thirty-two and one-half cents per gallon.
(4) The rate of tax on special fuel for aircraft is three
cents per gallon.
(5) On all other special fuel, unless otherwise specified in
this section , the per gallon rate is the same as the motor fuel
tax.
b. Indelible dye meeting United States environmental
protection agency and internal revenue service regulations must
be added to fuel before or upon withdrawal at a terminal or
refinery rack for that fuel to be exempt from tax and the dyed
fuel may be used only for an exempt purpose.
Sec. 6. APPLICABILITY —— INVENTORY TAX. Notwithstanding
section 452A.85, persons who have title to motor fuel, ethanol
blended gasoline, undyed special fuel, compressed natural gas,
or liquefied petroleum gas in storage and held for sale on
the effective date of an increase in the rate of excise tax
imposed on motor fuel, ethanol blended gasoline, or special
fuel pursuant to this division of this Act shall not be subject
to an inventory tax on the gallonage in storage as provided in
section 452A.85 as a result of the tax increases provided in
this division of this Act.
DIVISION II
ROAD FUNDING NEEDS —— EQUITABLE SOLUTIONS
Sec. 7. Section 307.31, Code 2011, is amended to read as
follows:
307.31 Periodic review of revenues —— evaluation of
alternative funding sources.
1. The department shall periodically review the current
revenue levels of the road use tax fund and the sufficiency of
those revenues for the projected construction and maintenance
needs of city, county, and state governments in the future.
The department shall submit a written report to the general
assembly regarding its findings by December 31 every five
two years, beginning in 2011 2013 . The report may include
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recommendations concerning funding levels needed to support the
future mobility and accessibility for users of Iowa’s public
road system.
2. The department shall evaluate alternative funding
sources for road maintenance and construction and report to
the general assembly at least every five two years on the
advantages and disadvantages and the viability of alternative
funding mechanisms. The department’s evaluation of alternative
funding sources may be included in the report submitted to the
general assembly under subsection 1 .
Sec. 8. NEW SECTION . 307.32 Operation, maintenance, and
improvement of state roads —— annual review.
The department shall convene a meeting, at least annually,
of representatives of Iowa cities and counties and the
department to review practices relating to the operation,
maintenance, and improvement of the state’s public road system
and to identify ways to jointly increase the efficiency of
those practices.
Sec. 9. ALTERNATIVELY FUELED, HYBRID, AND HIGH FUEL
EFFICIENCY VEHICLES. The department of transportation shall
evaluate mechanisms that could be used as an alternative
to the motor fuel tax in relation to alternatively fueled,
hybrid, and high fuel efficiency vehicles, including commercial
vehicles, to assure that owners and operators of those vehicles
are required to share in the cost of maintaining, operating,
and improving Iowa roads. The department shall recommend an
alternative funding mechanism in its next report to the general
assembly regarding alternative funding sources for roads as
required under section 307.31.
Sec. 10. EQUITABLE FEE STUDY. The department of
transportation shall conduct a study to determine whether
the various types of vehicles and equipment using the public
roadways are paying equitable fees used for the construction
and maintenance of Iowa roads. The department shall report
its findings and any recommendations to the general assembly
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by June 30, 2012.
Sec. 11. EFFECTIVE UPON ENACTMENT. The following provision
of this Act, being deemed of immediate importance, takes effect
upon enactment:
1. The section of this Act relating to an equitable fee
study to be conducted by the department of transportation.
EXPLANATION
This bill contains various provisions relating to the
funding of Iowa roads.
DIVISION I —— MOTOR FUEL TAX. The bill increases the excise
tax on motor fuel and special fuel used in motor vehicles,
other than biodiesel blended fuel classified as B-10 or higher,
by five cents beginning January 1, 2013, and by an additional
five cents beginning January 1, 2014. The additional revenues
shall be credited to the TIME-21 fund, subject to the statutory
limitation on annual deposits to that fund. After the repeal
of the TIME-21 fund on June 30, 2028, the revenues will accrue
to the road use tax fund.
The bill provides that the distribution percentage formula
for determining the difference in the excise tax imposed on
ethanol blended gasoline and motor fuel other than ethanol
blended gasoline, which is due to expire on June 30, 2012, is
extended until June 30, 2022.
Pursuant to current law, when the rate of excise tax on
motor fuel, ethanol blended gasoline, undyed special fuel,
compressed natural gas, or liquefied petroleum gas is increased
by more than one-half cent per gallon, a person who has title
to such fuel held in storage for eventual sale is subject to an
inventory tax based on the gallonage in storage at the close of
the business day preceding the effective date of the increase.
The bill waives that requirement by stating that the inventory
tax shall not be imposed as a result of the tax increases
provided in the bill.
DIVISION II —— ROAD FUNDING NEEDS —— EQUITABLE SOLUTIONS.
Under current law, the department of transportation is required
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to periodically review current road use tax fund revenues
and the sufficiency of those revenues to meet projected
construction and maintenance needs of cities, counties, and the
state and submit a report of its findings and recommendations
to the general assembly every five years. The bill requires
more frequent reports, every two years. In addition, the
department is currently required to report to the general
assembly at least every five years regarding the viability of
alternative funding mechanisms for roads. The bill requires
that the report on alternative funding mechanisms be made at
least every two years.
The bill requires the department to convene a meeting of
representatives of Iowa cities, counties, and the department at
least annually to review practices relating to the operation,
maintenance, and improvement of the state’s public road system
and identify ways to jointly increase efficiency.
The bill requires the department to evaluate and recommend
mechanisms to be used as an alternative to the motor fuel tax
for alternatively fueled, hybrid, and high fuel efficiency
vehicles including commercial vehicles. The department’s
recommendations are to be included in its next periodic report
to the general assembly regarding alternative funding sources.
That report is due by December 31, 2013.
The department is also required to conduct a study to
determine whether the various types of vehicles and equipment
that use the public roadways are paying equitable fees in
support of Iowa roads. The department shall report its
findings and any recommendations to the general assembly by
June 30, 2012. This provision of the bill is effective upon
enactment.
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