BILL REQ. #:  H-5188.1 

READ FIRST TIME 02/05/08.   

     AN ACT Relating to renewable fuel content compliance; amending RCW 19.112.110, 19.112.120, 43.21F.045, 19.112.130, 19.112.130, and 19.112.130; adding a new section to chapter 19.112 RCW; adding a new section to chapter 43.24 RCW; adding a new section to chapter 43.63A RCW; adding a new section to chapter 82.01 RCW; adding a new section to chapter 43.23 RCW; creating a new section; prescribing penalties; and providing an expiration date.

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

NEW SECTION.  Sec. 1   The legislature finds that consumers should have access to a diversity of renewable fuels and fuel blends ranging from fuels composed of no renewable content to completely renewable fuels. It is the intent of the legislature to ensure that minimum renewable fuel content and reporting requirements for biodiesel and ethanol are enforced.

Sec. 2   RCW 19.112.110 and 2006 c 338 s 2 are each amended to read as follows:
     (1) Each special fuel licensee((s)) under chapter 82.38 RCW, other than international fuel tax agreement licensees, dyed special fuel users, and special fuel distributors, shall provide evidence to the department of licensing that at least two percent of ((the)) its total annual diesel fuel ((sold)) sales in Washington ((is)) are biodiesel fuel, following the earlier of: (a) November 30, 2008; or (b) when a determination is made by the director, published in the Washington State Register, that feedstock grown in Washington state can satisfy a two-percent requirement.
     (2) Each special fuel licensee((s)) under chapter 82.38 RCW, other than international fuel tax agreement licensees, dyed special fuel users, and special fuel distributors, shall provide evidence to the department of licensing that at least five percent of its total annual diesel fuel ((sold)) sales in Washington ((is)) are biodiesel fuel, when the director determines, and publishes this determination in the Washington State Register, that both in-state oil seed crushing capacity and feedstock grown in Washington state can satisfy a three-percent requirement.
     (3) The requirements of subsections (1) and (2) of this section shall take effect no sooner than one hundred eighty days after the determination has been published in the Washington State Register.
     (4) The director and the director of licensing shall each adopt rules, in coordination with each other, for enforcing and carrying out the purposes of this section.
     (5) If the governor designates, as described under section 4(4)(b) of this act, a state agency other than the department of licensing to adopt rules to enforce the minimum renewable fuel content and reporting requirements, that agency is responsible for the duties of the department of licensing in this section.

Sec. 3   RCW 19.112.120 and 2007 c 309 s 2 are each amended to read as follows:
     (1) By December 1, 2008, each motor vehicle fuel licensee((s)) under chapter 82.36 RCW, other than motor vehicle fuel distributors, shall provide evidence to the department of licensing that at least two percent of its total gasoline ((sold)) sales in Washington, measured on a quarterly basis, ((is)) are denatured ethanol.
     (2) If the director of ecology determines that ethanol content greater than two percent of the total gasoline sold in Washington will not jeopardize continued attainment of the federal clean air act's national ambient air quality standard for ozone pollution in Washington and the director of agriculture determines and publishes this determination in the Washington State Register that sufficient raw materials are available within Washington to support economical production of ethanol at higher levels, the director of agriculture may require by rule that each licensee((s)) provide evidence to the department of licensing that denatured ethanol comprises between two percent and at least ten percent of its total gasoline ((sold)) sales in Washington, measured on a quarterly basis.
     (3) The requirements of subsections (1) and (2) of this section shall take effect no sooner than one hundred eighty days after the determination has been published in the Washington State Register.
     (4) The director and the director of licensing shall each adopt rules, in coordination with each other, for enforcing and carrying out the purposes of this section.
     (5) Nothing in this section is intended to prohibit the production, sale, or use of motor fuel for use in federally designated flexibly fueled vehicles capable of using E85 motor fuel. Nothing in this section is intended to limit the use of high octane gasoline not blended with ethanol for use in aircraft.
     (6) If the governor designates, as described under section 4(4)(b) of this act, a state agency other than the department of licensing to adopt rules to enforce the minimum renewable fuel content and reporting requirements, that agency is responsible for the duties of the department of licensing in this section.

NEW SECTION.  Sec. 4   A new section is added to chapter 19.112 RCW to read as follows:
     (1) By January 15, 2009, each special fuel licensee under RCW 19.112.110(1) and each motor vehicle fuel licensee under RCW 19.112.120(1) shall submit a quarterly renewable fuel content report providing evidence of compliance to the energy policy division of the department of community, trade, and economic development. The report must contain the following:
     (a) The number of gallons of biodiesel fuel and ethanol requested quarterly from suppliers, blenders, or importers for distribution in Washington;
     (b) The number of gallons of biodiesel fuel and ethanol procured quarterly from suppliers, blenders, or importers for distribution in Washington;
     (c) The number of gallons of diesel and gasoline procured quarterly from suppliers, blenders, or importers for distribution in Washington; and
     (d) A brief description on efforts made by the licensee to comply with the minimum renewable fuel content requirements under RCW 19.112.110 and 19.112.120.
     (2)(a) The quarterly renewable fuel content report must be submitted to the energy policy division of the department of community, trade, and economic development within fifteen days after the end of the quarter.
     (b) The first quarterly report submitted by each licensee on January 15, 2009, must be collected by the energy policy division of the department of community, trade, and economic development for informational purposes. The energy policy division of the department of community, trade, and economic development shall notify licensees failing to submit the first quarterly report and inform them of the requirement to report under this section.
     (c) Beginning April 15, 2009, the failure to submit a renewable fuel content report by a licensee is deemed willful and results in a penalty for disregarding the reporting requirements under RCW 19.112.110 and 19.112.120.
     (d) The director of the energy policy division of the department of community, trade, and economic development shall impose a penalty on a licensee for failure to submit a quarterly renewable fuel content report. The penalty must be equal to ten thousand dollars for each renewable fuel content quarterly report not submitted to the energy policy division of the department of community, trade, and economic development. The penalty must be paid within fourteen days after notification by the energy policy division of the department of community, trade, and economic development of a failure to submit a quarterly renewable fuel content report.
     (3) The director of the energy policy division of the department of community, trade, and economic development shall design the quarterly renewable fuel content report as required under this section, distribute the report to applicable licensees in a timely manner, collect submitted reports, and submit an annual report to the legislature detailing compliance with the renewable fuel content requirements under RCW 19.112.110 and 19.112.120.
     (4)(a) By December 1, 2009, the energy policy division of the department of community, trade, and economic development shall report to the governor and the appropriate committees of the legislature (i) its recommendations on the lowest cost method for ensuring compliance with the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 and (ii) which state agency should adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120. The energy policy division of the department of community, trade, and economic development shall prepare its recommendations in consultation with the department of licensing, the department of agriculture, and the department of revenue in preparation of the report.
     (b) By December 30, 2009, the governor shall determine the appropriate agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 and shall designate the state agency to develop rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (5) All penalties paid under this section to the energy policy division of the department of community, trade, and economic development shall be deposited into the energy freedom account under RCW 43.325.040.
     (6) The department of community, trade, and economic development shall not publicly release, unless pursuant to an order of a court of competent jurisdiction, information submitted under this section as required by RCW 19.112.110 or 19.112.120, except information disclosed in aggregate form that does not permit the identification of information related to individual fuel licensees.

Sec. 5   RCW 43.21F.045 and 1996 c 186 s 103 are each amended to read as follows:
     (1) The department shall supervise and administer energy-related activities as specified in RCW 43.330.904 and shall advise the governor and the legislature with respect to energy matters affecting the state.
     (2) In addition to other powers and duties granted to the department, the department shall have the following powers and duties:
     (a) Prepare and update contingency plans for implementation in the event of energy shortages or emergencies. The plans shall conform to chapter 43.21G RCW and shall include procedures for determining when these shortages or emergencies exist, the state officers and agencies to participate in the determination, and actions to be taken by various agencies and officers of state government in order to reduce hardship and maintain the general welfare during these emergencies. The department shall coordinate the activities undertaken pursuant to this subsection with other persons. The components of plans that require legislation for their implementation shall be presented to the legislature in the form of proposed legislation at the earliest practicable date. The department shall report to the governor and the legislature on probable, imminent, and existing energy shortages, and shall administer energy allocation and curtailment programs in accordance with chapter 43.21G RCW.
     (b) Establish and maintain a central repository in state government for collection of existing data on energy resources, including:
     (i) Supply, demand, costs, utilization technology, projections, and forecasts;
     (ii) Comparative costs of alternative energy sources, uses, and applications; and
     (iii) Inventory data on energy research projects in the state conducted under public and/or private auspices, and the results thereof.
     (c) Coordinate federal energy programs appropriate for state-level implementation, carry out such energy programs as are assigned to it by the governor or the legislature, and monitor federally funded local energy programs as required by federal or state regulations.
     (d) Develop energy policy recommendations for consideration by the governor and the legislature.
     (e) Provide assistance, space, and other support as may be necessary for the activities of the state's two representatives to the Pacific northwest electric power and conservation planning council. To the extent consistent with federal law, the director shall request that Washington's council members request the administrator of the Bonneville power administration to reimburse the state for the expenses associated with the support as provided in the Pacific Northwest Electric Power Planning and Conservation Act (P.L. 96-501).
     (f) Cooperate with state agencies, other governmental units, and private interests in the prioritization and implementation of the state energy strategy elements and on other energy matters.
     (g) Serve as the official state agency responsible for coordinating implementation of the state energy strategy.
     (h) No later than December 1, 1982, and by December 1st of each even-numbered year thereafter, prepare and transmit to the governor and the appropriate committees of the legislature a report on the implementation of the state energy strategy and other important energy issues, as appropriate.
     (i) Provide support for increasing cost-effective energy conservation, including assisting in the removal of impediments to timely implementation.
     (j) Provide support for the development of cost-effective energy resources including assisting in the removal of impediments to timely construction.
     (k) Adopt rules, under chapter 34.05 RCW, necessary to carry out the powers and duties enumerated in this chapter.
     (l) Provide administrative assistance, space, and other support as may be necessary for the activities of the energy facility site evaluation council, as provided for in RCW 80.50.030.
     (m) Appoint staff as may be needed to administer energy policy functions and manage energy facility site evaluation council activities. These employees are exempt from the provisions of chapter 41.06 RCW.
     (n) Ensure compliance with the minimum renewable fuel content reporting requirements under section 4 of this act.
     (3) To the extent the powers and duties set out under this section relate to energy education, applied research, and technology transfer programs they are transferred to Washington State University.
     (4) To the extent the powers and duties set out under this section relate to energy efficiency in public buildings they are transferred to the department of general administration.

NEW SECTION.  Sec. 6   A new section is added to chapter 43.24 RCW to read as follows:
     (1)(a) The director of licensing shall adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (b) The director shall impose penalties to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (2) This section applies only if the governor designates the department of licensing as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

NEW SECTION.  Sec. 7   A new section is added to chapter 43.63A RCW to read as follows:
     (1)(a) The director of the department of community, trade, and economic development shall adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (b) The director shall impose penalties to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (2) This section applies only if the governor designates the department of community, trade, and economic development as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

Sec. 8   RCW 19.112.130 and 2006 c 338 s 4 are each amended to read as follows:
     (1) The department of ((licensing)) community, trade, and economic development shall not publicly release, unless pursuant to an order of a court of competent jurisdiction, information submitted as evidence as required by RCW 19.112.110 or 19.112.120, except information disclosed in aggregate form that does not permit the identification of information related to individual fuel licensees.
     (2) This section applies only if the governor designates the department of community, trade, and economic development as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

NEW SECTION.  Sec. 9   A new section is added to chapter 82.01 RCW to read as follows:
     (1)(a) The director shall adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (b) The director shall impose penalties to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (2) This section applies only if the governor designates the department as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

Sec. 10   RCW 19.112.130 and 2006 c 338 s 4 are each amended to read as follows:
     (1) The department of ((licensing)) revenue shall not publicly release, unless pursuant to an order of a court of competent jurisdiction, information submitted as evidence as required by RCW 19.112.110 or 19.112.120, except information disclosed in aggregate form that does not permit the identification of information related to individual fuel licensees.
     (2) This section applies only if the governor designates the department of revenue as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

NEW SECTION.  Sec. 11   A new section is added to chapter 43.23 RCW to read as follows:
     (1)(a) The director of the department shall adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (b) The director of the department shall impose penalties to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120.
     (2) This section applies only if the governor designates the department as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

Sec. 12   RCW 19.112.130 and 2006 c 338 s 4 are each amended to read as follows:
     (1) The department of ((licensing)) agriculture shall not publicly release, unless pursuant to an order of a court of competent jurisdiction, information submitted as evidence as required by RCW 19.112.110 or 19.112.120, except information disclosed in aggregate form that does not permit the identification of information related to individual fuel licensees.
     (2) This section applies only if the governor designates the department of agriculture as the agency to adopt rules to enforce the minimum renewable fuel content and reporting requirements under RCW 19.112.110 and 19.112.120 under section 4(4)(b) of this act.

NEW SECTION.  Sec. 13   Sections 4 and 5 of this act expire July 1, 2010.