Reprinted
April 3, 2009
ENGROSSED
HOUSE BILL No. 1398
_____
DIGEST OF HB 1398
(Updated April 2, 2009 2:44 pm - DI 92)
Citations Affected: IC 5-22; IC 6-2.5; IC 15-11; IC 15-15; IC 21-31;
noncode.
Synopsis: Ethanol incentives. Requires state educational institutions
to purchase mid-level blends of gasoline and ethanol, E85, and blended
biodiesel fuel to the extent possible. Provides that the E85 sales tax
deduction applies only to reporting periods beginning on January 1 and
ending before April 1. Specifies procedures for administering the
deduction. Transfers administration of the deduction from the
department of revenue to the state budget agency. Provides that the
amount of money expended on administering Indiana corn market
development statutes in a state fiscal year may not exceed 10% of the
total amount of assessments, grants, and gifts received by the corn
marketing council in that year. Establishes the retail merchant E85
deduction reimbursement fund. Requires the Indiana corn marketing
council's annual transfers to the retail merchant E85 deduction
reimbursement fund to be in amounts calculated to restore a balance of
$500,000. Adjusts corn checkoff refund and audit requirements. Adds
school corporations and state educational institutions to the list of
governmental entities that are eligible to apply to the department of
agriculture for a grant under the E85 fueling station grant program.
Effective: Upon passage; July 1, 2009; August 1, 2009.
Grubb, Friend, Pearson
, Oxley
(SENATE SPONSORS _ GARD, STUTZMAN, DEIG)
January 13, 2009, read first time and referred to Committee on Agriculture and Rural
Development.
February 17, 2009, amended, reported _ Do Pass.
February 23, 2009, read second time, amended, ordered engrossed.
February 24, 2009, engrossed.
February 25, 2009, read third time, passed. Yeas 98, nays 1.
SENATE ACTION
March 5, 2009, read first time and referred to Committee on Energy and Environmental
Affairs.
March 17, 2009, amended, reported favorably _ Do Pass.
April 2, 2009, read second time, amended, ordered engrossed.
Reprinted
April 3, 2009
First Regular Session 116th General Assembly (2009)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in
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Additions: Whenever a new statutory provision is being enacted (or a new constitutional
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NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in
this style type or
this style type reconciles conflicts
between statutes enacted by the 2008 Regular Session of the General Assembly.
ENGROSSED
HOUSE BILL No. 1398
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 5-22-5-8; (09)EH1398.2.1. -->
SECTION 1. IC 5-22-5-8, AS AMENDED BY P.L.6-2005,
SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 8. (a) This section does not apply to a political
subdivision, except a school corporation (as defined in
IC 20-18-2-16(a)).
(b) As used in this section, "blended biodiesel" has the meaning set
forth in IC 6-3.1-27-2.
(c) As used in this section, "diesel fueled vehicle" refers to a
vehicle that is capable of using diesel to fuel its primary motor.
(c) (d) As used in this section, "ethanol" means agriculturally
derived ethyl alcohol.
(d) As used in this section, "gasohol" means gasoline that contains:
(1) at least ten percent (10%) ethanol; or
(2) ethyl tertiary butyl ether (ETBE) additives derived from
ethanol.
(e) As used in this section, "E85" has the meaning set forth in
IC 6-6-1.1-103.
(e) (f) As used in this section, "gasoline fueled vehicle" refers to a
vehicle that is capable of using gasoline to fuel its primary motor.
(g) As used in this section "mid-level blend fuel" means a fuel
blend consisting of:
(1) at least twenty percent (20%) but not more than
seventy-three percent (73%) ethanol; and
(2) gasoline as the balance.
(f) (h) As used in this section, "vehicle" includes the following:
(1) An automobile.
(2) A truck.
(3) A tractor.
(g) (i) Except as provided by subsection (i), subsections (k) and (l),
a governmental body shall whenever possible purchase gasohol
mid-level blend fuel or E85 to fuel the gasoline fueled vehicles owned
or operated by the governmental body.
(h) (j) Except as provided by subsection (i), subsections (k) and (l),
a governmental body shall whenever possible purchase blended
biodiesel fuel to fuel the diesel fueled vehicles owned or operated by
the governmental body.
(i) (k) The following vehicles are exempt from the requirements of
subsections (g) (i) and (h): (j):
(1) A vehicle that is leased by the governmental body for thirty
(30) days or less.
(2) A vehicle whose official operating manual, as issued by the
manufacturer of the vehicle, contains a statement that the use of
gasohol or blended biodiesel fuel will damage the engine of the
vehicle.
(3) (2) A vehicle that:
(A) is primarily powered by an electric motor; or
(B) can use only propane, compressed or liquified natural gas,
or methanol as its fuel source.
(l) The following vehicles are exempt from the requirements of
subsection (i) or (j), whichever is appropriate:
(1) A gasoline fueled vehicle in which the use of mid-level
blend fuel or E85 has not been approved by the manufacturer.
(2) A diesel fueled vehicle in which the use of blended
biodiesel fuel has not been approved by the manufacturer.
(3) A gasoline fueled vehicle in which the use of mid-level
blend fuel is prohibited by the federal Clean Air Act (42
U.S.C. 7401 et seq.).
SOURCE: IC 6-2.5-7-5; (09)EH1398.2.2. -->
SECTION 2. IC 6-2.5-7-5, AS AMENDED BY P.L.146-2008,
SECTION 315, IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2009]: Sec. 5. (a) Each retail merchant who
dispenses gasoline or special fuel from a metered pump shall, in the
manner prescribed in IC 6-2.5-6, report to the department the following
information:
(1) The total number of gallons of gasoline sold from a metered
pump during the period covered by the report.
(2) The total amount of money received from the sale of gasoline
described in subdivision (1) during the period covered by the
report.
(3) That portion of the amount described in subdivision (2) which
represents state and federal taxes imposed under this article,
IC 6-6-1.1, or Section 4081 of the Internal Revenue Code.
(4) The total number of gallons of special fuel sold from a
metered pump during the period covered by the report.
(5) The total amount of money received from the sale of special
fuel during the period covered by the report.
(6) That portion of the amount described in subdivision (5) that
represents state and federal taxes imposed under this article,
IC 6-6-2.5, or Section 4041 of the Internal Revenue Code.
(7) The total number of gallons of E85 sold from a metered pump
during the period covered by the report.
(b) Concurrently with filing the report, the retail merchant shall
remit the state gross retail tax in an amount which equals six and
fifty-four hundredths percent (6.54%) of the gross receipts, including
state gross retail taxes but excluding Indiana and federal gasoline and
special fuel taxes, received by the retail merchant from the sale of the
gasoline and special fuel that is covered by the report and on which the
retail merchant was required to collect state gross retail tax. The retail
merchant shall remit that amount regardless of the amount of state
gross retail tax which the merchant has actually collected under this
chapter. However, the retail merchant is entitled to deduct and retain
the amounts prescribed in subsection (c), IC 6-2.5-6-10, and
IC 6-2.5-6-11.
(c) A retail merchant is entitled to deduct from the amount of state
gross retail tax required to be remitted under subsection (b) the amount
determined under STEP THREE of the following formula:
STEP ONE: Determine:
(A) the sum of the prepayment amounts made during the
period covered by the retail merchant's report; minus
(B) the sum of prepayment amounts collected by the retail
merchant, in the merchant's capacity as a qualified distributor,
during the period covered by the retail merchant's report.
STEP TWO: Subject to
subsection (d), subsections (d) and (f),
for
qualified reporting periods
beginning after June 30, 2009,
and ending before July 1, 2020, determine the product of:
(A) eighteen cents ($0.18); multiplied by
(B) the number of gallons of E85 sold at retail by the retail
merchant during the period covered by the retail merchant's
report.
STEP THREE: Add the amounts determined under STEPS ONE
and TWO.
For purposes of this section, a prepayment of the gross retail tax is
presumed to occur on the date on which it is invoiced.
(d) The total amount of deductions allowed under subsection (c)
STEP TWO may not exceed
one million dollars ($1,000,000) the
amount of money that the budget agency determines is available in
the retail merchant E85 deduction reimbursement fund established
under IC 15-15-12-30.5 for the deductions for all retail merchants in
all a particular qualified reporting
periods. period. A retail merchant
is not required to apply for an allocation of deductions under
subsection (c) STEP TWO.
If the department determines that the sum
of:
(1) the deductions that would otherwise be reported under
subsection (c) STEP TWO for a reporting period; plus
(2) the total amount of deductions granted under subsection (c)
STEP TWO in all preceding reporting periods;
will exceed one million dollars ($1,000,000), Before August 1 of each
year, the budget agency shall estimate whether the amount of
deductions from the immediately preceding qualified reporting
period that are subject to reimbursement under
IC 15-15-12-30.5(f) and the deductions expected to be reported
under subsection (c) STEP TWO for the qualified reporting
periods beginning after December 31 and ending before April 1 of
the following year will exceed the amount of money available in the
retail merchant E85 deduction reimbursement fund for the
deductions. If the budget agency determines that the amount of
money in the retail merchant E85 deduction reimbursement fund
is insufficient to cover the amount of the deductions expected to be
reported, the
department budget agency shall publish in the Indiana
Register a notice that the deduction program under subsection (c) STEP
TWO is
terminated after the date specified suspended with respect to
the qualified reporting periods occurring in the following calendar
year in the notice and that no
additional deductions will be granted for
retail transactions occurring
after the date specified in the notice. in the
qualified reporting periods occurring in the following calendar
year.
(e) As used in this section, "qualified reporting period" refers
to a reporting period beginning after December 31 and ending
before April 1 of each year.
(f) The budget agency may suspend the deduction program
under subsection (c) STEP TWO for a particular year at any time
during a qualified reporting period if the budget agency
determines that the amount of money in the retail merchant E85
deduction reimbursement fund and the amount of money that will
be transferred to the fund on July 1 will not be sufficient to
reimburse the deductions expected to occur before the deduction
program for the year ends on March 31. The budget agency shall
immediately provide notice to the participating retail merchants of
the decision to suspend the deduction program for that year.
SOURCE: IC 15-11-11-6.5; (09)EH1398.2.3. -->
SECTION 3. IC 15-11-11-6.5, AS ADDED BY P.L.91-2008,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2009]: Sec. 6.5. As used in this chapter, "unit" means a city,
town, county, or township, school corporation (as defined in
IC 20-18-2-16(a)), or state educational institution (as defined in
IC 21-7-13-32).
SOURCE: IC 15-15-12-29; (09)EH1398.2.4. -->
SECTION 4. IC 15-15-12-29, AS ADDED BY P.L.2-2008,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2009]: Sec. 29. (a) The council shall pay all expenses incurred
under this chapter with money from the assessments remitted to the
council under this chapter.
(b) The council may invest all money the council receives under this
chapter, including gifts or grants that are given for the express purpose
of implementing this chapter, in the same way allowed by law for
public funds.
(c) The council may expend money from assessments and from
investment income not needed for expenses for market development,
promotion, and research.
(d) The council may not use money received, collected, or accrued
under this chapter for any purpose other than the implementation of
purposes authorized by this chapter. The amount of money
expended on administering this chapter in a state fiscal year may
not exceed ten percent (10%) of the total amount of assessments,
grants, and gifts received by the council in that state fiscal year.
SOURCE: IC 15-15-12-30.5; (09)EH1398.2.5. -->
SECTION 5. IC 15-15-12-30.5 IS ADDED TO THE INDIANA
CODE AS A
NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2009]:
Sec. 30.5. (a) The retail merchant E85
deduction reimbursement fund is established. The fund consists of:
(1) assessments transferred by the council for deposit in the
fund under section 32.5 of this chapter;
(2) gifts; and
(3) grants.
(b) Except as provided in subsection (g), money in the fund may
only be used for the purposes described in subsection (d).
(c) On May 1, the budget agency shall determine the sum of all
retail merchant deductions allowed under IC 6-2.5-7-5(d) in the
immediately preceding qualified reporting period (as defined in
IC 6-2.5-7-5(e)).
(d) The budget agency shall transfer the amount determined
under subsection (c) from the fund for deposit. The amount
transferred under this subsection shall be deposited in the same
manner as state gross retail and use taxes are required to be
deposited under IC 6-2.5-10-1.
(e) The treasurer of state shall invest the money in the fund not
currently needed to meet the obligations of the fund in the same
manner as other public money may be invested. Interest that
accrues from these investments shall be deposited in the fund.
(f) If the amount of money in the fund on May 1 is insufficient
to reimburse the state for all retail merchant deductions allowed
under IC 6-2.5-7-5(d) in the immediately preceding qualified
reporting period (as defined in IC 6-2.5-7-5(e)), the budget agency
shall deduct from any amounts transferred for deposit into the
fund in the remainder of that calendar year an amount sufficient
to cure the insufficiency. The budget agency shall transfer any
amounts deducted under this subsection for deposit in the same
manner as state gross retail and use taxes are required to be
deposited under IC 6-2.5-10-1.
(g) If the retail merchant E85 deduction program is terminated,
any balance in the fund must be transferred to the council.
SOURCE: IC 15-15-12-32.5; (09)EH1398.2.6. -->
SECTION 6. IC 15-15-12-32.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2009]: Sec. 32.5. (a) On July 1, 2010, the
council shall transfer five hundred thousand dollars ($500,000) to
the budget agency for deposit in the retail merchant E85 deduction
reimbursement fund established by section 30.5 of this chapter.
(b) On July 1, 2011, and each year thereafter, the council shall
transfer to the budget agency for deposit in the retail merchant
E85 deduction reimbursement fund established by section 30.5 of
this chapter an amount equal to the difference between:
(1) five hundred thousand dollars ($500,000); minus
(2) the balance remaining in the fund on June 30.
However, the amount transferred under this subsection may not
exceed five hundred thousand dollars ($500,000).
SOURCE: IC 15-15-12-33; (09)EH1398.2.7. -->
SECTION 7. IC 15-15-12-33, AS ADDED BY P.L.2-2008,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2009]: Sec. 33. (a) If a producer has sold corn and the state
assessment was deducted from the sale price of the corn, the producer
may secure a refund equal to the amount deducted upon filing a written
application.
(b) A producer's application for a refund under this section must be
made to the council not more than one hundred eighty (180) days after
the state assessment is deducted from the sale price of the producer's
corn.
(c) The council shall provide application forms to a first purchaser
for purposes of this section upon request and make application forms
available on the council's Internet web site. Before July 1, 2009, a first
purchaser shall provide an application form to each producer along
with each settlement form that shows a deduction. After June 30, 2009,
a first purchaser shall make application forms available in plain view
at the first purchaser's place of business.
(d) Proof that an assessment has been deducted from the sale price
of a producer's corn must be attached to each application for a refund
submitted under this section by a producer. The proof that an
assessment was deducted may be in the form of a duplicate or an
original copy of the purchase invoice or settlement sheet from the first
purchaser. The claim refund form and proof of assessment may be
mailed or faxed to the council. The refund form must clearly state how
to request a refund, the address where the form may be mailed, and the
fax number where the form may be faxed.
(e) If a refund is due under this section, the council shall remit the
refund to the producer not later than thirty (30) days after the date the
producer's completed application and proof of assessment are received.
SOURCE: IC 15-15-12-34; (09)EH1398.2.8. -->
SECTION 8. IC 15-15-12-34, AS ADDED BY P.L.2-2008,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2009]: Sec. 34. The checkoff
assessment and remittance
record refund form must:
(1) be in a format that allows a corn producer to submit the same
form for an assessment refund;
(2) (1) contain the address and fax number of the location to
which the assessment refund form may be sent;
(3) (2) contain information concerning procedures to claim an
assessment refund; and
(4) (3) contain any other information determined necessary by the
council.
SOURCE: IC 15-15-12-35; (09)EH1398.2.9. -->
SECTION 9. IC 15-15-12-35, AS ADDED BY P.L.2-2008,
SECTION 6, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2009]: Sec. 35. (a) A first purchaser shall keep detailed
records of all assessments collected and remitted under this chapter for
at least three (3) years.
(b) Upon request, a first purchaser shall supply the council with any
information from records kept under subsection (a).
(c) The council may periodically audit a first purchaser's checkoff
assessment and remittance records kept under subsection (a). An audit
must be conducted by:
(1) a qualified public accountant of the council's choosing; or
(2) an auditor who is familiar with the:
(A) storage;
(B) conditioning;
(C) shipping; and
(D) handling;
of agricultural commodities.
and The costs of the audit shall be paid by the council.
SOURCE: IC 21-31-9-3; (09)EH1398.2.10. -->
SECTION 10. IC 21-31-9-3 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 3. (a) As used in this section, "blended
biodiesel" has the meaning set forth in IC 6-3.1-27-2.
(b) As used in this section, "diesel fueled vehicle" refers to a
vehicle that is capable of using diesel to fuel its primary motor.
(c) As used in this section, "ethanol" means agriculturally
derived ethyl alcohol.
(d) As used in this section, "E85" has the meaning set forth in
IC 6-6-1.1-103.
(e) As used in this section, "gasoline fueled vehicle" refers to a
vehicle that is capable of using gasoline to fuel its primary motor.
(f) As used in this section, "mid-level blend fuel" means a fuel
blend consisting of:
(1) at least twenty percent (20%) but not more than
seventy-three percent (73%) ethanol; and
(2) gasoline as the balance.
(g) As used in this section, "vehicle" includes the following:
(1) An automobile.
(2) A truck.
(3) A tractor.
(h) Except as provided by subsections (j) and (k), a state
educational institution shall whenever possible purchase mid-level
blend fuel or E85 to fuel the gasoline fueled vehicles owned or
operated by the state educational institution.
(i) Except as provided by subsections (j) and (k), a state
educational institution shall whenever possible purchase blended
biodiesel fuel to fuel the diesel fueled vehicles owned or operated
by the state educational institution.
(j) The following vehicles are exempt from the requirements of
subsections (h) and (i):
(1) A vehicle that is leased by the state educational institution
for thirty (30) days or less.
(2) A vehicle that:
(A) is primarily powered by an electric motor; or
(B) can use only propane, compressed or liquified natural
gas, or methanol as its fuel source.
(k) The following vehicles are exempt from the requirements of
subsection (h) or (i), whichever is appropriate:
(1) A gasoline fueled vehicle in which the use of mid-level
blend fuel or E85 has not been approved by the manufacturer.
(2) A diesel fueled vehicle in which the use of blended
biodiesel fuel has not been approved by the manufacturer.
(3) A gasoline fueled vehicle in which the use of mid-level
blend fuel is prohibited by the federal Clean Air Act (42
U.S.C. 7401 et seq.).
SOURCE: IC 6-2.5-7-5.5; (09)EH1398.2.11. -->
SECTION 11. IC 6-2.5-7-5.5 IS REPEALED [EFFECTIVE JULY
1, 2009].
SOURCE: IC 15-15-12-30; (09)EH1398.2.12. -->
SECTION 12. IC 15-15-12-30 IS REPEALED [EFFECTIVE
AUGUST 1, 2009].
SOURCE: ; (09)EH1398.2.13. -->
SECTION 13. [EFFECTIVE AUGUST 1, 2009] (a) On August 1,
2009, the budget agency shall transfer any remaining balance in
the Indiana corn market development account established under
IC 15-15-12-30 (before its repeal) to the retail merchant E85
deduction reimbursement fund established by IC 15-15-12-30.5, as
added by this act.
(b) This SECTION expires January 1, 2010.
SOURCE: ; (09)EH1398.2.14. -->
SECTION 14.
An emergency is declared for this act.