(1) Existing law requires the Department of Food and Agriculture to establish specifications for automotive spark-ignition engine fuels, as prescribed. Existing law makes a violation of the provisions relating to weights and measures, including fuels and lubricants, a crime.
This bill would define "propane fuel blend" and require a propane fuel blend for use as a motor vehicle fuel to meet certain ASTM International specifications, as described. Because a violation of these provisions would be a crime, this bill would impose a state-mandated local program.
(2) Existing law requires, with certain specified exceptions, every person offering for sale or selling any motor fuel to the public from any place of business to display, as prescribed, on the premises the total prices of the three major grades of motor vehicle fuel offered for sale.
This bill would exempt a propane fuel blend, as defined, from these requirements.
(3) The Use Fuel Tax Law imposes, with certain exceptions, a state excise tax at specified rates per gallon on the use of fuel, as defined. The Use Fuel Tax Law provides that the owner or operator, except an interstate user, of a vehicle propelled by a system using liquefied petroleum gas, liquid natural gas, or compressed natural gas may pay the fuel tax for the use of those fuels by paying an annual flat rate fuel tax according to a prescribed schedule. Existing law makes a violation of the Use Fuel Tax Law a crime.
This bill would, on or after January 1, 2021, set the state excise tax under the Use Fuel Tax Law upon a propane fuel blend and upon dimethyl ether at the rates of $0.06 and $0.048, respectively, for each gallon used. The bill would add dimethyl ether and a propane fuel blend to the categories of fuels for which an owner or operator may pay an annual flat rate fuel tax in lieu of the per gallon fuel tax. The bill would exempt from excise taxes under the Use Fuel Tax Law the use of dimethyl ether and a propane fuel blend in a vehicle during any period of time for which the owner or operator of the vehicle has instead paid the applicable annual flat rate fuel tax. The bill would also provide that to the extent that an owner or operator has provided written representation to a fuel seller that the owner or operator has prepaid the annual flat rate fuel tax for dimethyl ether or for a propane fuel blend, the owner or operator shall be solely responsible for paying the applicable fuel taxes under the Use Fuel Tax Law, and the fuel seller shall not be liable for collecting and remitting those taxes. Because a violation of these provisions would be a crime, this bill would impose a state-mandated local program.
(4) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.

Statutes affected:
AB 2663: 13470 BPC, 13400 BPC, 13440 BPC, 13531 BPC, 8651.7 RTC
02/20/20 - Introduced: 13470 BPC, 8651.7 RTC
05/05/20 - Amended Assembly: 13470 BPC, 13400 BPC, 13440 BPC, 13531 BPC, 8651.7 RTC
AB2663: 13470 BPC, 8651.7 RTC