2006 Legislation
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SENATE BILL NO. 1267 – Fuels, renewable, standard

SENATE BILL NO. 1267

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Bill Status



S1267.....................................................by TRANSPORTATION
RENEWABLE FUEL STANDARDS - ETHANOL - Adds to existing law  to provide an
ethanol blended fuel standard; to provide an exemption; and to provide
application to federally regulated storage tanks in certain counties for a
certain period.
                                                                        
01/18    Senate intro - 1st rdg - to printing
01/19    Rpt prt - to Transp

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1267
                                                                        
                                BY TRANSPORTATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO MOTOR FUELS; AMENDING CHAPTER 2, TITLE  71,  IDAHO  CODE,  BY  THE
  3        ADDITION  OF  A  NEW SECTION 71-241A, IDAHO CODE, TO PROVIDE FOR RENEWABLE
  4        FUEL STANDARDS,  TO DEFINE A TERM, TO  PROVIDE  AN  ETHANOL  BLENDED  FUEL
  5        STANDARD,   TO  PROVIDE AN EXEMPTION TO THE ETHANOL BLENDED FUEL STANDARDS
  6        AND TO PROVIDE APPLICATION TO FEDERALLY REGULATED STORAGE TANKS IN CERTAIN
  7        COUNTIES FOR A CERTAIN PERIOD.
                                                                        
  8    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  9        SECTION 1.  That Chapter 2, Title 71, Idaho Code,  be,  and  the  same  is
 10    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 11    ignated as Section 71-241A, Idaho Code, and to read as follows:
                                                                        
 12        71-241A.  RENEWABLE FUEL STANDARD -- EXEMPTION -- EXCEPTION.
 13        (1)  (a) The renewable fuel standard as set forth in  this  section  shall
 14        come  into full force and effect at the beginning of the next fiscal quar-
 15        ter that is at least sixty (60) days after the director of the  department
 16        of agriculture certifies that there is a production facility or facilities
 17        that  are  producing  ethanol  with a combined capacity of at least thirty
 18        million (30,000,000) gallons on an annual basis within the state of Idaho.
 19        (b)  For the purposes of implementing the  renewable  fuel  standard,  all
 20        ethanol  that is produced from Idaho grown feedstock at a facility located
 21        outside the state but within five (5) miles of  the  Idaho  border,  shall
 22        qualify as Idaho produced ethanol.
 23        (2)  For  purposes  of  this section, "person responsible for the product"
 24    means a person or persons, corporation, partnership, stock  company,  society,
 25    association,  or  an  agent  or employee who processes, blends, holds, stores,
 26    imports, transfers, distributes, offers for sale or use,  or  sells  petroleum
 27    products  in  Idaho  and who possesses petroleum products at the time they are
 28    sampled or inspected by the director.
 29        (3)  (a) Except as set forth in subsections (4) and (5) of  this  section,
 30        on  and  after  implementation  of  the  renewable fuel standard, a person
 31        responsible for the product shall ensure that all gasoline sold or offered
 32        for sale in Idaho must contain at least ten percent (10%) denatured  etha-
 33        nol by volume.
 34        (b)  For  purposes of enforcing the minimum ethanol requirement of subsec-
 35        tion (3)(a) of this section, a gasoline/ethanol blend will be construed to
 36        be in compliance if the ethanol content, exclusive of denaturants and per-
 37        mitted contaminants, comprises not less than nine and two-tenths   percent
 38        (9.2%) by volume of agriculturally derived denatured ethanol that complies
 39        with  the following criteria and any applicable amendments to the criteria
 40        promulgated or published after July 1, 2006:
 41             (i)   Denatured ethanol that is to be blended with gasoline  must  be
 42             agriculturally derived and must comply with ASTM specification D4806.
 43             This  includes  the requirement that ethanol may be denatured only as
                                                                        
                                           2
                                                                        
  1             specified in 27 CFR 20 and 27 CFR 21;
  2             (ii)  The blend shall comply with the volatility requirements  in  40
  3             CFR 80;
  4             (iii) The  blend  shall  comply  with ASTM specification D4814 or the
  5             gasoline base stock from which a gasoline/ethanol blend was  produced
  6             and must comply with ASTM specification D4814; and
  7             (iv)  The  blend  shall  not  be  blended  with  casinghead gasoline,
  8             absorption  gasoline, condensation gasoline, drip gasoline, or  natu-
  9             ral  gasoline  after the gasoline/ethanol blend has been sold, trans-
 10             ferred, or otherwise removed from a refinery or terminal.
 11        (4)  A person responsible for the product may hold, store, import,  trans-
 12    fer,  distribute, offer for sale or use, or sell the petroleum product that is
 13    not blended in accordance with subsection (3) of this section, so long as  the
 14    product  is  for use in aircraft legally authorized to use motor vehicle fuel.
 15    The person responsible for the product shall comply with the following:
 16        (a)  The petroleum product shall be unleaded premium grade with an  octane
 17        rating of ninety-one (91) or greater;
 18        (b)  The  outlet  shall  use  no  more  than one (1)  storage tank for the
 19        petroleum product under this exemption;
 20        (c)  The pump stand dispensing the petroleum product under this  exemption
 21        must  be  posted with a permanent notice stating: "NONOXYGENATED GASOLINE.
 22        FOR USE IN AIRCRAFT LEGALLY AUTHORIZED TO USE MOTOR  VEHICLE  FUEL  ONLY."
 23        This notice must be posted at least two (2) feet above the ground.
 24        (5)  (a) The  person responsible for the product shall ensure that ethanol
 25        blended fuel, as set forth in subsection (3) of this section, shall not be
 26        delivered to federally regulated storage tanks within Ada and Canyon coun-
 27        ties that have not implemented stage one vapor  recovery  during  June  15
 28        through  September  15  of  each year. During this period, only nonblended
 29        fuel may be delivered to federally regulated tanks without stage one vapor
 30        recovery.
 31        (b)  A person responsible for the product may allow  delivery  of  ethanol
 32        blended  fuel,  as  set forth in subsection (3) of this section within Ada
 33        and Canyon counties to federally regulated storage  tanks  that  have  not
 34        implemented  stage one vapor recovery during the period of June 15 through
 35        September 15 so long as the federally regulated tank  has received  deliv-
 36        ery of ethanol blended fuel prior to January 1, 2007, and has done so con-
 37        sistently until the renewable fuel standard has been implemented.

Statement of Purpose / Fiscal Impact


                      STATEMENT OF PURPOSE
                            RS15610
                                
This legislation will create a new section of Idaho Code to
implement a renewable fuel standard once Idaho is producing 30
million gallons of ethanol.  The standard specifies that gasoline
sold for motor vehicle use in the state shall contain at least
10.0 percent ethanol. The production of ethanol in Idaho will
significantly strengthen our economy, particularly in rural
areas, providing jobs, local tax base and new markets for farm
crops. Using ethanol-blended fuel in Idaho will reduce our
dependence on imported fuels and will also reduce emissions from
motor vehicles and the adverse impacts of air pollution within
the State

                         FISCAL IMPACT
                                
There is no fiscal impact to the general fund of the state of
Idaho.  

By adoption of the companion piece of legislation, which repeals
the current state fuel tax deduction for ethanol blended fuels
upon implementation of the renewable fuel standard, there will be
an increase in state fuel tax revenues of $750,000 per year,
which is currently being foregone under the deduction. There is a
possibility that there will be gasoline retailers who voluntarily
use ethanol blended fuels prior to the implementation of the
renewable fuel standard which would reduce the state fuel tax
revenues by 2.5 cents per gallon of ethanol blended fuel until
the deduction is removed. Without adoption of the companion piece
of legislation, this bill would result in a $15.25 million
reduction in state fuel taxes when the renewable fuel standard is
implemented.  



Sponsors:
Senator Stan Williams      Representative JoAn Wood
Senator Curt McKenzie      Representative Ann Rydalch
Senator John McGee         Representative Stan Bastian
Senator David Langhorst    Representative Ken Roberts
                           Representative Elaine Smith
                 



Contact: Russ Hendricks, 342-2688

                      
  
STATEMENT OF PURPOSE/FISCAL NOTE               S 1267