Bill Summary – FastDemocracy

Senate Study Bill 3187 - Introduced
                                  SENATE FILE _____
                                  BY (PROPOSED COMMITTEE ON
                                      APPROPRIATIONS BILL BY
                                      CHAIRPERSON KRAAYENBRINK)
                            A BILL FOR
An Act relating to ethanol blended gasoline, by providing
  for gasoline storage and dispensing infrastructure and a
  financing program, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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    Section 1. Section 159A.14, subsection 1, paragraph
 a, subparagraph (1), Code 2024, is amended by striking the
 subparagraph and inserting in lieu thereof the following:
    (1) (a) Except as provided in this subparagraph, the
 ethanol infrastructure shall have the capacity to store and
 dispense E-85 gasoline.
    (b) (i) If the ethanol infrastructure is not used to store
 and dispense E-85 gasoline, it must have the capacity to store
 and dispense ethanol blended gasoline classified as E-15 or
 higher.
    (ii) This subparagraph division is repealed July 1, 2025.
    (c) (i) If the ethanol infrastructure is not used to store
 and dispense E-85 gasoline, it must have the capacity to store
 and dispense ethanol blended gasoline classified as E-40 or
 higher.
    (ii) This subparagraph division shall be implemented
 beginning July 1, 2025.
    (iii) This subparagraph division is repealed July 1, 2030.
    (d) The ethanol infrastructure may store, blend, and
 dispense ethanol or ethanol blended gasoline from a motor
 fuel blender pump. The ethanol infrastructure must at least
 include a motor fuel blender pump that dispenses different
 classifications of ethanol blended gasoline, if it allows E-85
 gasoline to be dispensed at all times that the blender pump is
 operating.
    Sec. 2. Section 455G.30, Code 2024, is amended by adding the
 following new subsections:
    NEW SUBSECTION. 4A. “Dispenser breakaway” means the part
 of gasoline storage and dispensing infrastructure that acts to
 immediately stop the flow of motor fuel from its storage system
 to its dispenser in the event that its dispensing hose or
 associated hanging infrastructure becomes detached, including
 when a vehicle pulls away from the dispenser while its nozzle
 is attached to the vehicle.
    NEW SUBSECTION. 4B. “E-85 gasoline” means the same as
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 defined in section 214A.1.
    NEW SUBSECTION. 8. “Shear valve” means the part of gasoline
 storage and dispensing infrastructure that acts to immediately
 stop the flow of motor fuel from its storage system to its
 dispenser in the event of an emergency hazard, including but
 not limited to a vehicle impacting the dispenser or a fire.
    Sec. 3. Section 455G.32, Code 2024, is amended to read as
 follows:
    455G.32 E-85 gasoline Ethanol blended gasoline —— compatible
 infrastructure —— compliance requirement.
    1. A retail dealer shall not install, replace, or convert
 gasoline storage and dispensing infrastructure used to store
 and dispense ethanol blended gasoline classified as E-15 or
 higher, unless the installed, replaced, or converted gasoline
 infrastructure is capable of storing and dispensing ethanol
 blended gasoline classified as E-85 gasoline.
    2. a. Notwithstanding subsection 1, a retail dealer
 may install, replace, or convert a section of the gasoline
 infrastructure beginning at a point where the shear valve ends
 and continuing until the point where the dispenser breakaway
 ends that is incompatible with E-85 gasoline. However, that
 section of the gasoline infrastructure must be compatible with
 the following:
    (1) (a) Ethanol blended gasoline classified as E-15 or
 higher.
    (b) This subparagraph is repealed July 1, 2025.
    (2) (a) Ethanol blended gasoline classified as E-40 or
 higher.
    (b) This subparagraph shall be implemented beginning July
 1, 2025.
    b. This subsection is repealed July 1, 2030.
    2. 3. The gasoline infrastructure must be all of the
 following:
    a. Listed as compatible for use with ethanol blended
 gasoline classified for that part of the gasoline
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 infrastructure as E-85 provided in subsection 1 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. 4. APPLICATIONS FOR FINANCIAL INCENTIVES. This
 Act does not require the renewable fuel infrastructure board
 established in section 159A.13 to reconsider or reapprove a
 decision made prior to the effective date of this Act for
 an award of financial incentives under the renewable fuel
 infrastructure program for retail motor fuel sites established
 in section 159A.14.
    Sec. 5. EFFECTIVE DATE. This Act, being deemed of immediate
 importance, takes effect upon enactment.
                           EXPLANATION
         The inclusion of this explanation does not constitute agreement with
          the explanation’s substance by the members of the general assembly.
    BACKGROUND —— GENERAL. This bill provides for the use
 of infrastructure used to store and dispense ethanol blended
 gasoline owned by a retail dealer of motor fuel (retail
 dealer) who sells gasoline on a retail basis from a permanent
 geographic location referred to as a retail motor fuel site
 (retail site) (Code section 214A.1).
    BACKGROUND —— TERMINOLOGY. Ethanol blended gasoline refers
 to a formulation of gasoline blended with ethyl alcohol that
 meets fuel standards adopted by the department of agriculture
 and land stewardship (DALS) (Code sections 214A.1 and 214A.2)
 in accordance with ASTM international specifications and the
 federal Clean Air Act Amendments of 1990 (42 U.S.C. §7661)
 administered by the United States environmental protection
 agency (EPA). Classifications of ethanol blended gasoline
 are generally determined by the volume percent of ethanol
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 and designated as E-xx where “xx” stands in for the volume
 percent of ethanol. There are three principal types of ethanol
 blended gasoline referred to commonly as E-10 formulated with
 9 or 10 percent ethanol by volume, E-15 formulated with 15
 percent ethanol by volume, and the highest classification E-85
 formulated with between 68 to 83 percent ethanol by volume
 (Code section 214A.1). Generally, the use of E-15 during
 summer months is allowed only by waiver issued by the EPA.
    BACKGROUND —— E-15 ACCESS STANDARD. Beginning July 1, 2023,
 a retail dealer is required to comply with an E-15 access
 standard that requires a retail dealer to advertise for sale
 and sell E-15 from a minimum number of qualifying gasoline
 dispensers, commonly described as pumps, located at the retail
 dealer’s retail site (Code chapter 214A, subchapter III).
 There are two access standards. In order to comply with the
 general E-15 access standard, the retail dealer must dispense
 E-15 from one qualifying gasoline dispenser if there is only
 one such dispenser located at the retail site or from at least
 50 percent of all qualifying dispensers if there is more than
 one such dispenser located at the retail site. In order to
 comply with the alternative E-15 access standard, the retail
 dealer cannot install, replace, or convert a gasoline storage
 tank at the retail site on or after July 1, 2023, and the retail
 dealer must advertise for sale and sell E-15 from at least one
 qualifying dispenser on and after January 1, 2026. Once the
 retail dealer no longer complies with the alternative E-15
 access standard (e.g., by installing a new tank), the retail
 dealer must comply with the general E-15 access standard. An
 exemption exists for small retail motor fuel sites in operation
 prior to January 1, 2023 (Code section 214A.36).
    BACKGROUND —— INFRASTRUCTURE PROGRAM FOR RETAIL MOTOR FUEL
 SITES. Under the renewable fuel infrastructure program for
 retail motor fuel sites (financing program), an eligible retail
 dealer may be awarded moneys on a cost-share basis by the
 renewable fuel infrastructure board (RFIB) and DALS to assist
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 in improving the retail dealer’s retail site by installing,
 replacing, or converting infrastructure (new infrastructure) to
 be used to store, blend, or dispense ethanol blended gasoline
 in compliance with the general E-15 access standard (Code
 section 159A.14). Thus, the financing program could be used
 to upgrade infrastructure that had been used to store and
 dispense E-0 or E-10. However, the new infrastructure must
 have the capacity of storing and dispensing either E-85 only or
 a variety of classifications ranging from E-15 to E-85 as part
 of a blender pump system.
    BACKGROUND —— NEW INSTALLATION OF GASOLINE INFRASTRUCTURE.
 Generally, the department of natural resources regulates
 infrastructure used to store motor fuel stored in underground
 tanks, including ethanol blended gasoline, located at a
 retail site. A retail dealer at such a retail site who uses
 infrastructure compatible with E-15 must install, replace, or
 convert that infrastructure with new infrastructure that is
 compatible with E-85 (Code section 455G.32).
    BILL’S PROVISIONS —— INFRASTRUCTURE PROGRAM FOR RETAIL
 MOTOR FUEL SITES. The bill provides a transition period for
 infrastructure supported by an award of cost-share moneys
 under the financing program. Until July 1, 2025, the new
 infrastructure must be compatible with E-15; from July 1, 2025,
 until July 1, 2030, the new infrastructure must be compatible
 with ethanol blended gasoline classified as E-40; and on and
 after July 1, 2030, the new infrastructure must be compatible
 with E-85. The bill’s provisions do not affect decisions
 regarding financing by the RFIB made prior to the bill’s
 effective date.
    BILL’S PROVISIONS —— NEW INSTALLATION OF GASOLINE
 INFRASTRUCTURE. The same transition period applies to a retail
 dealer when installing, replacing, or converting a certain
 section of the infrastructure that had been used to dispense
 E-15. In that case, the new infrastructure must be compatible
 with E-85 except for one section of the infrastructure
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 extending from the shear valve through to the dispenser
 breakaway. Until July 1, 2025, the infrastructure section
 must be compatible with E-15; from July 1, 2025, until July
 1, 2030, the section of the infrastructure must be compatible
 with ethanol blended gasoline classified as E-40; and on and
 after July 1, 2030, the section of the infrastructure must be
 compatible with E-85, meaning compatibility throughout the
 entire system.
    BILL’S PROVISIONS —— EFFECTIVE DATE. The bill takes effect
 upon enactment.
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Statutes affected: 
Introduced: 159A.14, 455G.30, 455G.32