SB532: exempting biodiesel from the road toll.

SB 532-FN - AS AMENDED BY THE SENATE

03/04/04 0677s

03/17/04 0736s

2004 SESSION

04-3263

03/09

SENATE BILL 532-FN

AN ACT exempting biodiesel from the road toll.

SPONSORS: Sen. Flanders, Dist 7; Sen. Eaton, Dist 10; Sen. Johnson, Dist 2; Rep. Leach, Hills 42

COMMITTEE: Transportation

ANALYSIS

This bill exempts biodiesel and certain biodiesel blends from the road toll.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

03/04/04 0677s

03/17/04 0736s

04-3263

03/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Four

AN ACT exempting biodiesel from the road toll.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Section; Motor Vehicles; Words and Phrases Defined; Biodiesel. Amend RSA 259 by inserting after section 6 the following new section:

259:6-a Biodiesel. "Biodiesel" shall mean a renewable diesel fuel substitute that is composed of mono-alkyl esters of long chain fatty acids, is derived from vegetable oils or animal fats, and meets the requirements of the American Society for Testing and Materials (ASTM) specification D6751.

2 New Paragraph; Road Tolls; Refunds; Biodiesel. Amend RSA 260:47 by inserting after paragraph VI the following new paragraph:

VII. Any distributor that sells or dispenses biodiesel or any blend of biodiesel with petroleum-based diesel fuel, where at least 20 percent of the blend by volume is biodiesel, shall be entitled to apply for a refund for the biodiesel or for the portion of the blend that is biodiesel as provided in this section.

3 Biodiesel Refund; Report by Department of Safety. The department of safety shall report to the fiscal committee of the general court by October 1 of each year the number of gallons of biodiesel or qualifying biodiesel blend for which refunds were issued in the preceding fiscal year pursuant to RSA 260:47, VII. For the first year that the number of gallons equals or exceeds 1,000,000, the department shall also certify the number of gallons to the secretary of state.

4 Repeal. The following are repealed:

I. RSA 259:6-a, relative to biodiesel.

II. RSA 260:47, VII, relative to the biodiesel road toll refund.

5 Contingency. Section 4 of this act shall take effect upon the date that the department of safety certifies to the secretary of state that the number of gallons of biodiesel or qualifying biodiesel blend for which refunds were issued in the preceding fiscal year pursuant to RSA 260:47, VII equaled or exceeded 1,000,000, as provided in section 3 of this act.

6 Effective Date.

I. Section 4 of this act shall take effect as provided in section 5 of this act.

II. The remainder of this act shall take effect one year after its passage.

LBAO

04-3263

Amended 3/25/04

SB 532 FISCAL NOTE

AN ACT exempting biodiesel from the road toll.

FISCAL IMPACT:

The Department of Safety indicates this bill, as amended by the Senate (Amendment #2004-0736s), will decrease state highway fund revenues by an indeterminable amount in FY 2005 and state expenditures and local revenue by an indeterminable amount in FY 2006 each year thereafter. There will be no fiscal impact on county revenue or county and local expenditures.

METHODOLOGY:

The Department states this bill permits a refund of biodiesel and certain biodiesel blends from the road toll paid on only the portion of those blended gallons that is biodiesel, and will range from 20% to 100%. Currently, $21 million (14%) of the $149 million gasoline and diesel taxes are derived from the sale of diesel fuel. The Department cannot estimate how many licensed distributors would take advantage of the refund provisions of this bill, however, for every 100,000 gallons blended as biodiesel, the state will lose $18,000 (100,000 x $.18) of highway fund revenue, and additionally, 12% less of the road toll revenue would be distributed to local governments the following year, in accordance with the RSA 235:23 apportionment A formula. The Department further states that although this bill intends to limit the refunds to 1 million gallons and then trigger the repeal of the refund provision, it is conceivable that the total gallons certified to the Secretary of State could exceed 1 million because the Department would have to wait until the end of the fiscal year before issuing the certification of gallonage. The Department assumes a July 1, 2004 implementation date, and assumes that distributors will sell in excess of the equivalent of 1 million gallons of 100% pure biodiesel fuel.

The Department also estimates that state expenditures will increase for auditing and administration of this exemption for equipment and chemical analysis to ensure that the fuel sold met the 20% blending requirement and for additional enforcement personnel. The Department cannot estimate these costs because they are dependent on the number of distributors that claim the exemption.