HOUSE AMENDED

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY SCARNATI AND M. WHITE, JUNE 4, 2009

AS REPORTED FROM COMMITTEE ON AGRICULTURE AND RURAL AFFAIRS, HOUSE OF REPRESENTATIVES, AS AMENDED, SEPTEMBER 17, 2009  

AN ACT

Amending the act of July 10, 2008 (P.L.1109, No.78), entitled

"An act providing for the study and mandated content of

biofuels," further providing for definitions, for biodiesel

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content in diesel fuel sold for on-road use and for agency

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responsibilities; and imposing penalties.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 3(f) of the act of July 10, 2008

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(P.L.1109, No.78), known as the Biofuel Development and In-State

Production Incentive Act, is amended to read:

Section 3.  Biodiesel content in diesel fuel sold for on-road

use.

Section 1.  Section 2 of the act of July 10, 2008 (P.L.1109,

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No.78), known as the Biofuel Development and In-State Production

Incentive Act, is amended by adding definitions to read:

Section 2.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"American Society for Testing and Materials International" or

"ASTM."  A private organization that utilizes committees of

industry representatives and regulators to develop product

quality standards and test methods to be used by industries,

regulatory agencies and purchasing agents.

"Annualized basis."  The sum of three consecutive months of

in-State production multiplied by four.

"ASTM specification."  A standard quality specification

developed and published by the American Society for Testing and

Materials International. Each specification includes references

to standard test methods, also developed and published by ASTM.

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"Biodiesel blend."  A blend of diesel fuel and biodiesel fuel

to be sold or offered for sale to ultimate consumers in this

Commonwealth for use in on-road compression ignition engines.

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"Consumer."  A person that purchases automotive fuel for

purposes other than resale.

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"Diesel fuel."  Petroleum diesel fuel that complies with ASTM

D975 or its successor standard.

"Distributor."  A person that manufactures, refines, receives

for storage, distributes, sells or uses petroleum products,

including diesel fuel, biodiesel and biodiesel blend, in this

Commonwealth for subsequent distribution to another person other

than the consumer.

"In-line injection blending."  Blending biodiesel with diesel

fuel through the use of a dispensing device which includes

Department of Agriculture-approved and National Institute of

Standard and Technology-approved meters on both the biodiesel

and diesel fuel supply and the ability to detect, alarm and

discontinue loading biodiesel blends that fall outside the

desired blend ratio by more than 0.5%.

"Load rack terminals."  A location where the commercial

transfer of petroleum products, including diesel fuel, biodiesel

and biodiesel blend, at the wholesale level is conducted

utilizing meters employed in the measurement of product

delivered to a seller by a buyer.

"Manufacture."  To produce, mix, blend, repackage or further

process.

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"Person."  An individual, corporation, partnership, stock

company, society, association, business unit or agent or

employee thereof.

"Producer."  A person that purchases component elements and

blends them to produce automotive fuel, including biodiesel

blend.

"Refinery" or "terminal."  A petroleum refinery, pipeline

terminal, river terminal, load rack terminal, storage facility,

producer facility or other point of origin where petroleum

products, including diesel fuel, biodiesel and biodiesel blend,

are manufactured, blended or imported by rail, truck, barge or

pipe and held, stored, transferred, offered for distribution,

distributed, offered for sale or sold.

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"Retailer."  A person that sells automotive fuel, including

diesel fuel, biodiesel and biodiesel blend, to the consumer.

"Sale," "sell," "offer for sale" or "sold."  To offer for

sale, contract, barter, exchange, distribute or transfer title.

"Unclassified importer."  A person that imports or causes to

be imported diesel fuel, biodiesel or biodiesel blend for use,

distribution or sale in this Commonwealth, but that does not

qualify as a distributor.

Section 2.  Section 3(a) and (f) of the act are amended to

read:

Section 3.  Biodiesel content in diesel fuel sold for on-road

use.

(a)  Volume standards.--The following standards shall apply:

(1)  All diesel fuel sold or offered for sale to ultimate

consumers in this Commonwealth for use in on-road compression

ignition engines must [contain] be blended with biodiesel so

as to achieve a biodiesel blend of at least 2% biodiesel by

volume one year after the in-State production volume of

40,000,000 gallons of biodiesel has been reached and

sustained for three months on an annualized basis as

determined by the department. The biodiesel blend shall

comply with ASTM specification D975 or its successor

standard.

(2)  All diesel fuel sold or offered for sale to ultimate

consumers in this Commonwealth for use in on-road compression

ignition engines must [contain] be blended with biodiesel so

as to achieve a biodiesel blend of at least 5% biodiesel by

volume one year after the in-State production volume of

100,000,000 gallons of biodiesel has been reached and

sustained for three months on an annualized basis as

determined by the department. The biodiesel blend shall

comply with ASTM specification D975 or its successor

standard.

(3)  All diesel fuel sold or offered for sale to ultimate

consumers in this Commonwealth for use in on-road compression

ignition engines must [contain] be blended with biodiesel so

as to achieve a biodiesel blend of at least 10% biodiesel by

volume one year after the in-State production volume of

200,000,000 gallons of biodiesel has been reached and

sustained for three months on an annualized basis as

determined by the department. The biodiesel blend shall

comply with ASTM specification D7467 or its successor

standard.

(4)  All diesel fuel sold or offered for sale to ultimate

consumers in this Commonwealth for use in on-road compression

ignition engines must [contain] be blended with biodiesel so

as to achieve a biodiesel blend of at least 20% biodiesel by

volume one year after the in-State production volume of

400,000,000 gallons of biodiesel has been reached and

sustained for three months on an annualized basis as

determined by the department. The biodiesel blend shall

comply with ASTM specification D7467 or its successor

standard.

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(f)  [Exception] Exceptions.--The requirements of this

section shall not apply to [aviation]:

(1)  Aviation fuel, home heating fuel or where prohibited

by law.

(2)  Diesel fuel produced from 100% Pennsylvania grade

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crude oil by a small refiner, as defined by 40 CFR 80.1101(g)

(relating to small refinery), through December 31, 2010.

Section 3.  Section 5 of the act is amended by adding

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subsections to read:

Section 5.  Agency responsibilities.

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(e)  Enforcement.--

(1)  The department is charged with the general

enforcement of this act. The department may employ all proper

means for the enforcement of this act, including issuing

notices and orders, filing violations for criminal

prosecution, seeking injunctive relief, imposing civil

penalties and entering into consent agreements.

(2)  Any person that transfers, offers for sale or sells

biodiesel or biodiesel blend in this Commonwealth for use in

on-road compression ignition engines shall register with the

department. If a person has multiple locations where the

person conducts such activities, each location shall be

separately registered, but may be submitted in a single

electronic form. This paragraph includes in-State and out-of-

State persons, such as refineries, terminals, distributors,

producers, retailers and unclassified importers, that

transfer, sell or offer for sale biodiesel and biodiesel

blend products for ultimate on-road use by consumers in this

Commonwealth.

(3)  (i)  Any time biodiesel blend is sold or transferred

from a refinery, terminal, shipper or any person, for

sale to ultimate consumers in this Commonwealth, either

directly or through a retailer or other person, a bill of

lading or shipping manifest shall be provided to the

person that receives the biodiesel blend. The shipping

manifest or bill of lading shall accompany the biodiesel

blend to the retailer. For direct consumer sales of

biodiesel blend by a terminal or refinery, such bills of

lading or shipping manifest shall be retained at the

point of sale. A copy of such records shall be retained

by the refinery, terminal, distributor, producer,

unclassified importer or person responsible for a period

of one year from delivery of the biodiesel blend product

or for a longer period of time if part of an enforcement

action.

(ii)  For biodiesel blend, the bill of lading or

shipping manifest shall contain and disclose the

following information:

(A)  The Pennsylvania registration number, name

and location of the terminal, refinery, distributor,

producer, unclassified importer or person that

created the biodiesel blend.

(B)  The biodiesel content, stating volume

percentage, based upon gallons of biodiesel per

gallons of diesel fuel base-stock, or an ASTM “Bxx”

designation where “xx” denotes the volume percentage

biodiesel included in the blended product.

(C)  The ASTM specification of the biodiesel used

in the biodiesel blend.

(D)  The grade and ASTM specification of the

diesel fuel.

(E)  The ASTM specification of the biodiesel

blend.

(F)  The total gallons of biodiesel blend sold,

shipped or transferred.

(G)  A certification signed by the refinery,

terminal, distributor, producer, unclassified

importer or other person, that created the biodiesel

blend stating the information contained in the bill

of lading or shipping manifest is true and correct

subject to the penalties of 18 Pa.C.S. § 4904

(relating to unsworn falsification to authorities).

(iii)  Retailers offering a biodiesel blend product

for ultimate sale to consumers in this Commonwealth for

use in on-road compression ignition engines shall assure

they receive and retain for their records a copy of the

bills of lading and shipping manifests required by

subparagraphs (i) and (ii). These records shall be

retained for a period of one year from receipt of the

biodiesel blend product or for a longer period of time if

part of an enforcement action either at the facility

where the product is sold or at the corporate

headquarters, so long as the bills of lading and shipping

manifests remain at the facility where the product is

sold until such time as that product is sold or is no

longer present at the facility. Notwithstanding the

provisions of this subsection, no retailer shall be found

in violation of this act for failure to make the records

required by subparagraphs (i) and (ii) immediately

available to the department upon inspection of the

facility where the product is sold, provided that the

records are submitted to the department within two

business days.

(iv)  Any time biodiesel is sold or transferred from

any person to be sold or offered for sale to ultimate

consumers in this Commonwealth for use in on-road

compression ignition engines as part of a biodiesel

blend, a certification shall be provided to the person

that receives the biodiesel. The certification shall

accompany the biodiesel to the person that blends the

biodiesel with diesel fuel and shall accompany the

biodiesel blend into which the biodiesel has been

incorporated to the retailer. The certification shall be

signed by the person selling or transferring the

biodiesel and state that the biodiesel is compliant with

the definition and quality standards for biodiesel under

this act, including ASTM D-6751-02, or its successor

standard, and be made subject to the penalties of 18

Pa.C.S. § 4904. A copy of the certification shall be

retained by the person selling or transferring the

biodiesel, the person blending the biodiesel with diesel

fuel and by the retailer for a period of one year from

delivery of the biodiesel or biodiesel blend, as

applicable, or for a longer period of time if part of an

enforcement action. With regard to a retailer, a copy of

the certification may be retained at the corporate

headquarters so long as the certification remains at the

facility where the product is sold until such time as

that product is sold or is no longer present at the

facility. Notwithstanding the provisions of this

subsection, no retailer shall be found in violation of

this act for failure to make the records required by

subparagraphs (i) and (ii) immediately available to the

department upon inspection of the facility where the

product is sold, provided that the records are submitted

to the department within two business days.

(4)  The department shall have the following authority:

(i)  To conduct unannounced random inspections of any

person or establishment located in this Commonwealth that

stores, holds, blends, sells or offers for sale diesel

fuel, biodiesel or biodiesel blend. Inspections shall

include the premises, tanks, storage facilities,

transportation and storage vehicles, dispensing devices

and any other place where diesel fuel, biodiesel or

biodiesel blend is stored, held, blended, sold or offered

for sale.

(ii)  To take samples of and test the diesel fuel,

biodiesel and biodiesel blend being stored, held,

blended, sold or offered for sale.

(iii)  To audit the books and records, including

copying, pertaining to the diesel fuel, biodiesel or

biodiesel blend being stored, held, sold or offered for

sale, and its component parts, including:

(A)  Delivery invoices, bills of lading and

shipping manifests.

(B)  Sales invoices, bills of lading and shipping

manifests.

(C)  Inventory records.

(D)  Contracts and agreements between suppliers,

buyers and sellers.

(5)  The department is authorized to access, during

regular business hours, the premises, including the tanks,

storage facilities, transportation and storage vehicles,

dispensing devices and any other place where diesel fuel,

biodiesel or biodiesel blend is stored, held, blended, sold

or offered for sale, and the records of any establishment,

located in this Commonwealth, where diesel fuel, biodiesel or

biodiesel blend is stored, held, processed, distributed,

offered or exposed for sale or sold in this Commonwealth for

the purpose of investigation and enforcement of this act,

including auditing records and taking samples of diesel fuel,

biodiesel or biodiesel blend from tanks, storage facilities,

transportation and storage vehicles, dispensing devices and

any other place where diesel fuel, biodiesel or biodiesel

blend is stored, held, blended, sold or offered for sale. A

person that willfully and intentionally interferes with an

employee of the department in the performance of duties or

activities authorized under this act commits a misdemeanor of

the third degree.

(6)  The department shall have the authority to issue

stop-sale orders with respect to all biodiesel and biodiesel

blend stored, held, blended, sold or offered for sale to

ultimate consumers in this Commonwealth for use in on-road

compression ignition engines where the department determines,

after sampling and analysis, that the biodiesel or biodiesel

blend does not comply with the standards established by this

act or the regulations promulgated under this act and would

be detrimental to the operation of on-road compression

ignition engines if used for its intended use. The department

shall release the noncompliant biodiesel or biodiesel blend

for sale only when the department determines the biodiesel or

biodiesel blend is either brought into compliance with this

act or regulations promulgated under this act or it would no

longer be detrimental to the operation of on-road compression

ignition engines if used for its intended use. All such

biodiesel or biodiesel blend must be properly labeled as to

its noncompliant characteristics if released and permitted to

be sold without being brought into compliance with this act

or regulations promulgated under this act. A person who

knowingly sells or offers for sale biodiesel or biodiesel

blend subject to a stop-sale order in this Commonwealth for

use by ultimate consumers in on-road compression ignition

engines commits a misdemeanor of the third degree.

(f)  Penalties.--

(1)  (i)  The department may assess a civil penalty of

not less than $100 nor more than $1,000 per day for each

knowing violation of this act or a regulation promulgated

under this act.

(ii)  The department shall provide written notice of

the penalty amount as well as the general factual and

legal basis for the penalty and shall advise the affected

person that, within 15 days of receipt of the notice, the

person may file with the Secretary of Agriculture a

written request for an administrative hearing. Unless a

timely request has been filed, the written notice shall

become final. If a written request for a hearing is

timely filed, the hearing on the penalty assessment shall

be held in accordance with the provisions of 2 Pa.C.S.

Chs. 5 Subch. A (relating to practice and procedure of

Commonwealth agencies) and 7 Subch. A (relating to

judicial review of Commonwealth agency action).

(iii)  In cases of inability to collect the civil

penalty or failure of any person to pay all or a portion

of the penalty, the department may refer the matter to

the Office of General Counsel or the Office of Attorney

General, which shall institute an action in the

appropriate court to recover the penalty.

(2)  A person who knowingly violates a provision of this

act or a rule or regulation adopted or order issued under

this act:

(i)  Unless otherwise specified in this act, for the

first offense, commits a summary offense and shall, upon

conviction, be sentenced to pay a fine of not less than

$100 nor more than $500 plus costs of prosecution or to

imprisonment for not more than 90 days, or both.

(ii)  For a subsequent offense at a registered

location that occurs within two years of sentencing for

the prior violation, commits a misdemeanor of the third

degree and shall, upon conviction, be sentenced to pay a

fine of not less than $500 nor more than $1,000 plus

costs of prosecution or to imprisonment of not more than

one year, or both.

(3)  A person creating a biodiesel blend by means other

than in-line injection blending or another blending process

approved by the department as a substantial equivalent,

either through regulations promulgated under this act or upon

application to the department for approval pursuant to this

subsection, shall be found in violation of this act's

biodiesel percentage requirements for creating a biodiesel

blend that does not conform to this act's biodiesel

percentage requirements without proof of having knowingly

violated this act.

(4)  In addition to any other remedies set forth under

this act, a violation of this act or a regulation promulgated

under this act shall be abatable in the manner provided by

law or equity. In cases where the circumstances require it, a

mandatory preliminary injunction, special injunction or

temporary restraining order may be issued upon the terms

prescribed by the court, provided notice of the application

has been given to the respondent in accordance with the rules

of equity practice. In any proceeding, the court shall issue

a prohibitory or mandatory injunction if it finds that the

respondent is engaging in unlawful conduct as defined under

this act or is engaging in conduct which is causing immediate

and irreparable harm to the public. In addition to the

injunction, the court, in the equity proceeding, may assess

civil penalties in accordance with this section.

Section 2 4.  This act shall take effect in 60 days.

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