87R13856 TYPED

By: Goldman H.B. No. 3408

A BILL TO BE ENTITLED

AN ACT

relating to motor fuel metering and quality.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 2310.001 of the Occupations Code is amended as follows:

Sec. 2310.001. DEFINITIONS. (a) In this chapter:

(1) "Automotive fuel rating" has the meaning assigned by 15 U.S.C. Section 2821.

(2) [(1)] "Commercial [weighing or] measuring device" means a [weighing or] measuring device used in a commercial transaction.

(3) [(2)] "Commission" means the Texas Commission of Licensing and Regulation.

(4) [(3)] "Dealer" means a person who[:]

[(A)] is the operator of a retail motor fuel facility [ service station or other retail outlet; and]

[(B) delivers motor fuel into the fuel tanks of motor vehicles or motor boats].

(5) [(4)] "Department" means the Texas Department of Licensing and Regulation.

(6) "Distributor" means a person who makes retail or wholesale sales of motor fuel.

(7) [(5)] "Executive director" means the executive director of the department.

(8) [(6)] "Motor fuel" means gasoline, diesel fuel, gasoline blended fuel, aviation gasoline, aviation jet fuel, compressed natural gas, liquified natural gas, and other products that are capable of use as fuel for a gasoline-powered engine or a diesel-powered engine [has the meaning assigned by Section 162.001, Tax Code].

(9) [(7)] "Motor fuel metering device" means a commercial [weighing or] measuring device used for motor fuel sales.

(10) [(8)] "Operator" or "user" means a person in possession or control of a [weighing or] measuring device, including an owner, custodian, and seller.

(11) [(9)] "Sell" includes barter or exchange.

(12) "Supplier" has the meaning assigned by Section 162.001, Tax Code.

(13) [(10)] "Measuring [Weighing or measuring] device" means a [scale or a] mechanical or electronic device used to dispense or deliver a motor fuel by [weight,] volume, flow rate, or other measure or to compute the charge for a service related to motor fuel.

[(11) "Weight or measure of a motor fuel" means the weight or measure of a motor fuel as determined by a weighing or measuring device.]

(14) "Wholesaler" means a person who purchases tax-paid gasoline for resale or distribution at wholesale.

SECTION 2. Section 2310.002(c) of the Occupations Code, is amended as follows:

(c) The department may contract with one or more license holders under Subchapter D of this chapter [or Subchapter I, Chapter 13, Agriculture Code,] to perform the department's duties under this chapter related to motor fuel metering devices. A reference in this chapter to the commission or department in the context of a contracted service means the contractor.

SECTION 3. Section 2310.051 of the Occupations Code is amended as follows:

Sec. 2310.051. LEGAL STANDARDS. (a) The legal standard for the [weight or] measure of a motor fuel in this state is the standard [weight or] measure adopted and used by the government of the United States for that motor fuel. If the United States does not provide a standard [weight or] measure for a motor fuel, the standard for the motor fuel is that established by this subchapter.

(b) The commission may adopt rules for the purpose of administering this subchapter and bringing about uniformity between the standards established under this subchapter and the standards established by federal law.

(c) Except as otherwise provided by an express contract, a contract for work or sales by [weight or] measure of a motor fuel shall be construed in accordance with the standards of this subchapter.

(d) The standards of this subchapter shall be the guide for making any adjustment of [weighing or] measuring devices under the law of this state.

SECTION 4. Section 2310.053 of the Occupations Code is amended by adding subsection (c) as follows:

(c) A weighing or measuring device, as described by Chapter 13, Agriculture Code, that measures liquified petroleum gas is exempt from this chapter.

SECTION 5. Sections 2310.054, 2310.057, 2310.059, and 2310.060 of the Occupations Code are amended as follows:

Sec. 2310.054. SALE OF MOTOR FUEL BY PROPER MEASURE. (a) Motor [Except as otherwise provided by this section, motor] fuel shall be sold by liquid measure.

[(b) Compressed natural gas and liquefied natural gas shall be sold by weight].

(b) [(c)] A person violates this chapter if, in violation of this section, the person sells motor fuel by other than [weight or] liquid measure.

Sec. 2310.056. FALSE REPRESENTATION OF MOTOR FUEL QUANTITY. A person violates this chapter if the person or the person's representative or agent:

(1) sells or offers or exposes for sale a quantity of motor fuel that is less than the quantity the person represents; or

(2) as a buyer furnishing the [weight or] measure of a motor fuel by which the amount of the motor fuel is determined, takes or attempts to take more than the quantity the person represents.

Sec. 2310.057. USE OF INCORRECT MOTOR FUEL METERING DEVICE. (a) A person commits an offense if the person or the person's representative or agent knowingly uses an incorrect [weighing or] measuring device in:

(1) buying or selling motor fuel; or

(2) computing a charge for services rendered on the basis of [weight or] measure; or

(3) determining the [weight or] measure of motor fuel, if a charge is made for the determination.

Sec. 2310.059. TESTING BY DEPARTMENT. (a) The department shall from time to time [weigh or] measure an amount of motor fuel that is kept or offered for sale, sold, or in the process of delivery, in order to determine:

(1) if the motor fuel is of the amount or quantity represented; or

(2) if the motor fuel is being offered for sale or sold in accordance with law.

(b) If the department finds that any lot of motor fuel contains less of the motor fuel than the amount represented, the department may seize the motor fuel as evidence.

(c) A person commits an offense if the person or the person's employee or agent refuses to exhibit motor fuel being sold or offered for sale at a given [weight or] quantity, or ordinarily sold in that manner, to the department for testing and proving as to quantity.

Sec. 2310.060. STOP-SALE ORDER. (a) If the department has reason to believe that motor fuel is being sold or kept, offered, or exposed for sale in violation of this chapter or that motor fuel is being sold or offered for sale by or through the use of a motor fuel metering device that is in violation of this chapter, the executive director may issue an order to stop the sale of the motor fuel. The executive director shall issue the order to the dealer or operator of the retail motor fuel facility selling or offering [owner or custodian of] the motor fuel for sale [or seller of the motor fuel]. The person receiving the order may not sell the motor fuel until discharged by a court under Subsection (b) or until the executive director finds that the motor fuel or motor fuel metering device is in compliance with this chapter.

(b) A dealer or operator [The owner, custodian, or seller of motor fuel] prohibited from selling motor fuel [sale] by an order of the executive director is entitled to sue in a court where the motor fuel is found or is being sold or offered for sale for a judgment as to the justification of the order and for the discharge of the motor fuel in accordance with the findings of the court.

(c) This section does not limit the right of the department to proceed as authorized by other sections of this code.

SECTION 6. Section 2310.061(b) of the Occupations Code is amended as follows:

(b) It is a defense to prosecution or to the imposition of a civil or administrative penalty for a violation of Section 2310.057 or 2310.059 that a discrepancy between the actual [weight or] volume at the time of sale to a consumer or a discrepancy between the fill of a container and the capacity of the container is due to unavoidable leakage, shrinkage, evaporation, waste, or causes beyond the control of the seller acting in good faith.

SECTION 7. Sections 2310.101 and 2310.106 of the Occupations Code are amended as follows:

Sec. 2310.101. AUTHORITY TO INSPECT. [(a)] If the department has reason to believe that a motor fuel metering device is being used for a commercial transaction, [and] the device is not registered with the department, or the device is being used to facilitate the perpetuation of fraud, the department may inspect the device and the records [of the owner, operator, or user of the device] that relate to use of the device to determine whether the device is in compliance with this chapter.

[(b) The department has reason to believe a motor fuel metering device is being used for a commercial transaction if:]

[(1) the motor fuel metering device is found near motor fuel being sold or offered for sale by weight or measure and the device appears to be under the control or in the possession of the person selling the motor fuel or offering the motor fuel for sale; or]

[(2) other available evidence is sufficient for a prudent person to believe that the motor fuel metering device is being used for a commercial transaction.]

Sec. 2310.106. INSPECTION OF STANDARDS USED TO PERFORM DEVICE MAINTENANCE ACTIVITIES. (a) In this section, "state metrology laboratory" means the metrology laboratory maintained by the Department of Agriculture under Subchapter C, Chapter 13, Agriculture Code.

(b) The commission may adopt rules to regulate the frequency and place of inspection and correction of the standards for motor fuel used by an individual or business licensed by the department to perform device maintenance activities under Subchapter D [or an individual or business licensed under Subchapter I, Chapter 13, Agriculture Code].

(c) The department may inspect any standard for motor fuel used by an individual or business licensed by the department to perform device maintenance activities described by Subchapter D [or an individual or business licensed under Subchapter I, Chapter 13, Agriculture Code], if the department has reason to believe a standard is no longer in compliance with this chapter.

(d) The department shall keep a record of the inspection and character of standards for motor fuel inspected under this section.

[(e) The state metrology laboratory shall purchase additional sets of standards as necessary for use by a department inspector or other department personnel.]

(f) The state metrology laboratory, or a metrology laboratory certified by the National Institute of Standards and Technology and approved by the department, shall inspect and correct the standards for motor fuel used by the [a] department [inspector, another department employee], or an individual or business licensed by the department to perform device maintenance activities under Subchapter D[, or an individual or business licensed under Subchapter I, Chapter 13, Agriculture Code].

(g) The department and the state metrology laboratory may shall enter into a memorandum of understanding to implement this section. The memorandum of understanding must provide department personnel and persons licensed under Subchapter D with access to state metrology laboratory services equal to the access provided to Department of Agriculture personnel and persons licensed under Subchapter I, Chapter 13, Agriculture Code, and under equivalent terms and conditions.

SECTION 8. Section 2310.110(b) of the Occupations Code is amended as follows:

(b) A person commits an offense if the person or the person's representative or agent knowingly:

(1) offers or exposes for sale, hire, or award or sells an incorrect motor fuel metering device;

(2) possesses an incorrect motor fuel metering device; or

(3) sells, offers for sale, uses, or possesses for the purpose of sale or use a device or instrument to be used to falsify or intended to falsify a [weight or] measure for motor fuel.

SECTION 9. Section 2310.154(a) of the Occupations Code is amended as follows:

(a) A person is not required to hold a license issued under this subchapter if the person:

(1) is a department employee who is performing device maintenance activities in the scope of the person's duties for the department;

(2) is the owner or operator of a motor fuel metering device or an employee of the owner or operator of a motor fuel metering device and the person:

(A) completely removes the motor fuel metering device from the location at which the device was installed, including a device subject to an out-of-order tag, stop-sale order, security seal, lock, condemnation notice, or other item placed on the device by the department to prohibit use of the device; and

(B) notifies the department of the motor fuel metering device's removal not later than the 10th day after the date the device was removed in the manner provided by commission rule;

(3) performs device maintenance activities only on a motor fuel metering device that is:

(A) exempt from the inspection and registration requirements of Sections 2310.102 and 2310.103 under commission rules; and

(B) not required to be inspected by other commission rules; or

[(4) is a license holder under Subchapter I, Chapter 13, Agriculture Code.]

SECTION 10. Section 2310.2012(a) of the Occupations Code is amended as follows:

(a) Except as provided by Subsection (b), a distributor, supplier, or wholesaler[, or jobber] of motor fuel may not deliver to an outlet in this state a motor fuel mixture that contains ethanol or methanol exceeding one percent by volume of the mixture unless, at the time of the delivery of the mixture, the person also delivers to the outlet receiving the delivery a manifest, bill of sale, bill of lading, or other document evidencing delivery of the mixture, that includes a statement containing:

(1) the percentage of ethanol or methanol contained in the mixture; and

(2) the types and percentages of any associated cosolvents contained in the mixture.

SECTION 11. Section 2310.2013 of the Occupations Code is amended as follows:

Sec. 2310.2013. RECORD OF DELIVERY DOCUMENTS; INSPECTION AUTHORIZED. (a) Each dealer shall keep a copy of each document required to be delivered to the dealer by Section 2310.2012 until the fourth anniversary of the delivery date.

(b) Each distributor, supplier, and wholesaler[, and jobber] of motor fuel shall keep a copy of each document required to be delivered to the dealer by Section 2310.2012 until the fourth anniversary of the delivery date.

(c) The department or an authorized representative of the department may inspect documents described by this section. On written notice issued by the department or an authorized representative of the department to any employee at a dealer's retail motor fuel facility [station or retail outlet] or mailed to the principal place of business of a dealer, distributor, supplier, or wholesaler, [or jobber,] the dealer, distributor, supplier, or wholesaler[, or jobber] shall provide the department or authorized representative of the department with the documents described by this section within the period specified in the notice.

(d) The commission by rule may:

(1) require each dealer, distributor, supplier, and wholesaler[, and jobber] to maintain and make available to the department:

(A) invoices, receipts, or other transmittal documents or records, including electronically stored information, showing or describing the purchase, sale, delivery, or distribution of motor fuel;

(B) invoices, receipts, work orders, reports, or other documents, including electronically stored information, showing or describing the installation, maintenance, or repair of:

(i) motor fuel dispensing devices; and

(ii) any equipment used in connection with motor fuel dispensing devices to record, display, or produce receipts or audit trails concerning the purchase, sale, delivery, or distribution of motor fuel; and

(C) any record or other document related to the sampling and testing of motor fuel purchased, sold, delivered, or distributed by the dealer, distributor, supplier, or wholesaler[, or jobber]; and

(2) prescribe:

(A) the manner of filing documents or records required to be kept under this section or by commission rule; and

(B) the time, place, and manner of inspection of the documents or records.

SECTION 12. Section 2310.2014 of the Occupations Code, subsections (b) and (c) are amended as follows:

(b) Each distributor, [or] supplier, or wholesaler shall keep for at least one year at the distributor's, [or] supplier's, or wholesaler's principal place of business a copy of each delivery ticket or letter of certification required to be delivered by the distributor, [or] supplier, or wholesaler to a dealer in this state under 16 C.F.R. Part 306.

(c) The department or an authorized representative of the department may inspect a document required to be kept under this section. On written notice issued by the department or an authorized representative of the department to any employee at a dealer's retail motor fuel facility [station or retail outlet] or mailed to the dealer's principal place of business, the dealer shall provide the department or authorized representative of the department with the documents described by this section within the period specified in the notice.

SECTION 13. Section 2310.2015(b) of the Occupations Code, is amended as follows:

(b) A distributor, wholesaler or supplier of motor fuel may not deliver or transfer to a dealer in this state motor fuel that has an automotive fuel rating lower than the certification of the rating the distributor, wholesaler or supplier is required to make to the dealer under federal law.

SECTION 14. Section 2310.203 of the Occupations Code, is amended as follows:

Sec. 2310.203. TESTING OF MOTOR FUEL QUALITY. (a) The department or an authorized [a] representative of the department may collect samples and conduct testing at any location where motor fuel is kept, transferred, sold, or offered for sale to verify that the motor fuel complies with the minimum standards required by Section 2310.202. A license holder under Subchapter D of this chapter is considered an authorized representative of the department for purposes of this section.

[(b) The collection of samples and conducting of testing at a dealer's location must be performed by a license holder under Subchapter D of this chapter or Subchapter I, Chapter 13, Agriculture Code, under contract with the dealer. The license holder is considered a representative of the department for purposes of this section.]

(b) [(c)] On arriving at a facility to conduct testing under Subsection (a), the department or an authorized [a] representative of the department shall notify the owner or manager of the facility of the department's or authorized representative's presence and purpose. The department or an authorized representative of the department shall follow the most recent applicable procedures specified by the American Society for Testing and Materials (ASTM) International Standard D4057, D4177, D5842, or D5854 for the collection, sampling, and handling of fuel to prepare for laboratory analysis.

(c) [(d)] A person commits an offense if the person refuses to allow the [a] department or an authorized representative of the department to collect samples or conduct motor fuel testing under Subsection (a).

(d) [(e)] An offense under Subsection (c) [(d)] is a Class C misdemeanor.

SECTION 15. Section 2310.207 of the Occupations Code, subsections (a) and (b), are amended as follows:

Sec. 2310.207. CIVIL ACTION. (a) If a dealer or a distributor, supplier, or wholesaler[, or jobber] of motor fuel violates Section 2310.201, 2310.2012, 2310.2013, 2310.2014, or 2310.2015, a person [motor fuel user] who purchased the motor fuel and sustained damages or who has a complaint about the product may bring an action against the dealer, distributor, supplier, or wholesaler[, or jobber].

(b) The action may be brought, without regard to the specific amount of damages, in the district court in any county in which:

(1) the dealer, distributor, supplier, or wholesaler[, or jobber] transacts business; or

(2) the dealer resides.

SECTION 16. Section 2310.208 of the Occupations Code is amended as follows:

Sec. 2310.208. CIVIL PENALTY. A dealer, distributor, supplier, or wholesaler[, or jobber] who violates Section 2310.201, 2310.2012, 2310.2013, 2310.2014, or 2310.2015 is liable to this state for a civil penalty of not less than $200 and not more than $10,000.

SECTION 17. Chapter 2310 of the Occupations Code is amended by adding Subchapter F as follows:

SUBCHAPTER F. MOTOR FUEL METERING AND QUALITY ADVISORY BOARD.

Sec. 2310.220. Board; Membership. (a) The Motor Fuel Metering and Quality Advisory Board consists of nine members appointed by the presiding officer of the commission, with the commission's approval, as follows:

(1) two members who are dealers, or their representatives:

(A) one member with 500 or fewer registered devices;

(B) one member with more than 1,000 registered devices;

(2) one member who represents a service company licensed by the department;

(3) one member who represents a wholesaler or distributor;

(4) one member who represents a supplier;

(5) one member who represents a financial institution, as defined by 277.001(3), Financial Code, or credit card issuer; and

(6) one member who represents a law enforcement agency.

(b) Appointments to the board shall be made without regard to the race, color, disability, sex, religion, age, or national origin of the appointee.

Sec. 2310.221. Terms; Vacancy. (a) Members of the board serve staggered six-year terms, with the terms of one or two members expiring on the same date each odd-numbered year.

(b) If a vacancy occurs during a member's term, the presiding officer of the commission, with the commission's approval, shall appoint a replacement to fill the unexpired term.

Sec. 2310.222. Presiding Officer. The presiding officer of the commission, with the commission's approval, shall designate one member of the advisory board as presiding officer to serve in that capacity for a two-year term.

Sec. 2310.223. Board Duties. The board may advise the commission and department on:

(1) the adoption of appropriate standards for the installation, maintenance, calibration, alteration, operation, testing, and inspection of motor fuel dispensers, devices, and fuel;

(2) education and curricula for applicants and licensees;

(2) the content of examinations;

(3) proposed rules and standards on technical issues related to motor fuel metering and quality and payment card fraud, including payment card skimmers and shimmers; and

(4) other issues affecting motor fuel metering and quality.

(b) The advisory board shall meet at the call of the executive director or the presiding officer of the commission.

SECTION 18. The following provision of the Occupations Code are repealed:

(1) Section 2310.2001.

SECTION 19. Not later than December 31, 2021, the Texas Commission of Licensing and Regulation shall appoint members to the motor fuel metering and quality advisory board in accordance with this Act.

SECTION 20. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, the Act takes effect September 1, 2021.