77R7151 QS-D
By Swinford, et al. H.B. No. 788
Substitute the following for H.B. No. 788:
By Hardcastle C.S.H.B. No. 788
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to value-added processing of agricultural goods into fuel
1-3 ethanol and biodiesel and the fuel ethanol and biodiesel incentive
1-4 program.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Title 2, Agriculture Code, is amended by adding
1-7 Chapter 16 to read as follows:
1-8 CHAPTER 16. FUEL ETHANOL AND BIODIESEL PRODUCTION
1-9 Sec. 16.001. DEFINITIONS. In this chapter:
1-10 (1) "Account" means the fuel ethanol and biodiesel
1-11 production account.
1-12 (2) "ASTM" means the American Society for Testing and
1-13 Materials.
1-14 (3) "Biodiesel" means a monoalkyl ester that:
1-15 (A) is derived from vegetable oils, rendered
1-16 animal fats, or renewable lipids or a combination of those
1-17 ingredients; and
1-18 (B) meets the requirements of ASTM PS 121, the
1-19 provisional specification for biodiesel.
1-20 (4) "Fuel ethanol" means ethyl alcohol that:
1-21 (A) has a purity of at least 99 percent,
1-22 exclusive of added denaturants;
1-23 (B) has been denatured in conformity with a
1-24 method approved by the Bureau of Alcohol, Tobacco and Firearms of
2-1 the United States Department of the Treasury;
2-2 (C) meets the requirements of ASTM D4806, the
2-3 standard specification for ethanol used as a motor fuel; and
2-4 (D) is produced exclusively from agricultural
2-5 products or by-products or municipal solid waste.
2-6 (5) "Producer" means a person who operates a fuel
2-7 ethanol or biodiesel plant in this state.
2-8 Sec. 16.002. FUEL ETHANOL AND BIODIESEL GRANTS. (a) The
2-9 department shall make grants to producers as an incentive for the
2-10 development of the fuel ethanol and biodiesel industry and
2-11 agricultural production in this state.
2-12 (b) A producer is entitled to receive from the account 20
2-13 cents for each gallon of fuel ethanol or biodiesel produced in each
2-14 registered plant operated by the producer until the 10th
2-15 anniversary of the date production from the plant begins.
2-16 (c) The department by rule shall provide for the
2-17 distribution of grant funds under this chapter to producers. The
2-18 department shall make grants not less often than quarterly.
2-19 Sec. 16.003. FUEL ETHANOL AND BIODIESEL PRODUCTION ACCOUNT.
2-20 (a) The fuel ethanol and biodiesel production account is an
2-21 account in the general revenue fund that may be appropriated only
2-22 to the department for the purposes of this chapter, including the
2-23 making of grants under this chapter.
2-24 (b) The account is composed of money transferred to the
2-25 account at the direction of the legislature.
2-26 Sec. 16.004. PLANT REGISTRATION. (a) To be eligible for a
2-27 grant for fuel ethanol or biodiesel produced in a plant, a producer
3-1 must apply to the department for the registration of the plant. A
3-2 producer may apply for the registration of more than one plant.
3-3 (b) An application for the registration of a plant must show
3-4 to the satisfaction of the department that:
3-5 (1) the plant is capable of producing fuel ethanol or
3-6 biodiesel;
3-7 (2) the producer has made a substantial investment of
3-8 resources in this state in connection with the plant; and
3-9 (3) the plant constitutes a permanent fixture in this
3-10 state.
3-11 (c) The department shall register each plant that qualifies
3-12 under this section.
3-13 Sec. 16.005. REPORTS. (a) On or before the fifth day of
3-14 each month, a producer shall report to the department on:
3-15 (1) the number of gallons of fuel ethanol or biodiesel
3-16 produced at each registered plant operated by the producer during
3-17 the preceding month;
3-18 (2) the number of gallons of fuel ethanol or biodiesel
3-19 imported into this state by the producer during the preceding
3-20 month;
3-21 (3) the number of gallons of fuel ethanol or biodiesel
3-22 sold or blended with motor fuels by the producer during the
3-23 preceding month; and
3-24 (4) the total value of agricultural products consumed
3-25 in each registered plant operated by the producer during the
3-26 preceding month.
3-27 (b) A producer who fails to file a report as required by
4-1 this section is ineligible to receive a grant for the period for
4-2 which the report is not filed.
4-3 Sec. 16.006. MAXIMUM GRANT; PROPORTIONATE REDUCTION.
4-4 (a) For each fiscal year a producer may not receive grants for
4-5 more than 15 million gallons of fuel ethanol or biodiesel produced
4-6 at any one registered plant.
4-7 (b) If the department determines that the amount of money
4-8 credited to the account is not sufficient to distribute the full
4-9 amount of grant funds to eligible producers as provided by this
4-10 chapter for a fiscal year, the department shall proportionately
4-11 reduce the amount of each grant for each gallon of fuel ethanol or
4-12 biodiesel produced as necessary to continue the incentive program
4-13 during the remainder of the fiscal year.
4-14 SECTION 2. This Act takes effect September 1, 2001.