[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1646 Reported in Senate (RS)]





                                                       Calendar No. 473

104th CONGRESS

  2d Session

                                S. 1646

                          [Report No. 104-298]

_______________________________________________________________________

                                 A BILL

  To authorize and facilitate a program to enhance safety, training, 
   research and development, and safety education in the propane gas 
 industry for the benefit of propane consumers and the public, and for 
                            other purposes.

_______________________________________________________________________

                             June 27, 1996

                       Reported with an amendment





                                                       Calendar No. 473
104th CONGRESS
  2d Session
                                S. 1646

                          [Report No. 104-298]

  To authorize and facilitate a program to enhance safety, training, 
   research and development, and safety education in the propane gas 
 industry for the benefit of propane consumers and the public, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

               March 27 (legislative day, March 26), 1996

 Mr. Domenici (for himself, Mr. Ford, Mr. Dole, Mr. Lott, Mr. Heflin, 
 Mr. Shelby, Mr. Faircloth, Mr. Simpson, Mr. Cochran, Mr. Inhofe, Mr. 
    Warner, Mr. Helms, Mr. McConnell, Mr. Thurmond, Mr. Burns, Mr. 
  Johnston, Mr. Bingaman, Mr. Nickles, Mr. Lugar, Mrs. Kassebaum, Mr. 
  Coats, Mr. Grams, Mr. Kyl, Mr. Coverdell, Mr. Pryor, Mr. Bond, Mr. 
    Bumpers, Mr. Harkin, Mr. Thomas, Mr. Gregg, Mr. Smith, and Mrs. 
  Hutchison) introduced the following bill; which was read twice and 
       referred to the Committee on Energy and Natural Resources

                             June 27, 1996

              Reported by Mr. Murkowski, with an amendment
                  [Insert the part printed in italic]

_______________________________________________________________________

                                 A BILL


 
  To authorize and facilitate a program to enhance safety, training, 
   research and development, and safety education in the propane gas 
 industry for the benefit of propane consumers and the public, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Propane Education and Research Act 
of 1996''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) propane gas (also known as liquefied petroleum gas) is 
        an essential energy commodity that provides heat, hot water, 
        cooking fuel, and motor fuel, and has many other uses to 
        millions of Americans;
            (2) the use of propane is especially important to rural 
        citizens and farmers, offering an efficient and economical 
        source of gas energy;
            (3) propane has been recognized as a clean fuel and can 
        contribute in many ways to reducing pollution in cities and 
        towns of the United States; and
            (4) propane is primarily domestically produced, and the use 
        of propane provides energy security and jobs for Americans.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Council.--The term ``Council'' means a Propane 
        Education and Research Council established under section 4.
            (2) Industry.--The term ``industry'' means persons involved 
        in the United States in--
                    (A) the production, transportation, and sale of 
                propane; and
                    (B) the manufacture and distribution of propane 
                utilization equipment.
            (3) Industry trade association.--The term ``industry trade 
        association'' means an organization exempt from tax, under 
        paragraph 3 or 6 of section 501(c) of the Internal Revenue Code 
        of 1986, that represents the propane industry.
            (4) Odorized propane.--The term ``odorized propane'' means 
        propane that has had odorant added to it.
            (5) Producer.--The term ``producer'' means the owner of 
        propane at the time at which the propane is recovered at a gas 
        processing plant or refinery.
            (6) Propane.--The term ``propane''--
                    (A) means a hydrocarbon, the chemical composition 
                of which is predominantly C<SUP>3H<SUP>8, whether 
                recovered from natural gas or from crude oil; and
                    (B) includes liquefied petroleum gas or a mixture 
                of liquefied petroleum gases.
            (7) Public member.--The term ``public member'' means a 
        member of the Council, other than a representative of producers 
        or retail marketers, representing significant users of propane, 
        public safety officials, academia, the propane research 
        community, or other groups knowledgeable about propane.
            (8) Qualified industry organization.--The term ``qualified 
        industry organization'' means the National Propane Gas 
        Association, the Gas Processors Association, a successor of the 
        National Propane Gas Association or the Gas Processors 
        Association, or a group of retail producers or marketers that 
        collectively represent at least 25 percent of the volume of 
        propane produced or sold, respectively, in the United States.
            (9) Retail marketer.--The term ``retail marketer'' means a 
        person engaged primarily in the sale of odorized propane to 
        ultimate consumers or to retail propane dispensers.
            (10) Retail propane dispenser.--The term ``retail propane 
        dispenser'' means a person that sells, but is not engaged 
        primarily in the business of selling odorized propane to 
        ultimate consumers.
            (11) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

SEC. 4. REFERENDA.

    (a) Creation of Program.--
            (1) In general.--The qualified industry organizations may 
        conduct a referendum among producers and retail marketers for 
        the creation of a Propane Education and Research Council.
            (2) Expenses.--A referendum under paragraph (1) shall be 
        conducted at the expense of the qualified industry 
        organizations.
            (3) Reimbursement.--The Council, if established, shall 
        reimburse the qualified industry organizations for the cost of 
        the referendum accounting and documentation.
            (4) Independent auditing firm.--The referendum shall be 
        conducted by an independent auditing firm agreed to by the 
        qualified industry organizations.
            (5) Voting rights.--Voting rights in the referendum shall 
        be based on the volume of propane produced or odorized propane 
        sold in the calendar year previous to the year in which the 
        referendum is conducted, or other representative period agreed 
        to by the qualified industry organizations.
            (6) Certification of volume of propane.--All persons voting 
        in the referendum shall certify to the independent auditing 
        firm the volume of propane the person represents.
            (7) Approval.--On the approval of persons representing \2/
        3\ of the total volume of propane voted in the retail marketer 
        class and \2/3\ of all propane voted in the producer class, the 
        Council shall be established.
    (b) Termination or Suspension.--
            (1) Referendum.--On the Council's initiative, or on 
        petition to the Council by producers and retail marketers 
        representing 35 percent of the volume of propane produced and 
        sold, respectively, in the United States, the Council shall 
        conduct a referendum to determine whether the industry favors 
        termination or suspension of the Council.
            (2) Expense.--A referendum under paragraph (1) shall be 
        conducted at the expense of the Council.
            (3) Independent auditing firm.--The referendum shall be 
        conducted by an independent auditing firm selected by the 
        Council.
            (4) Termination or suspension.--Termination or suspension 
        shall take effect if approved by--
                    (A) persons representing more than \1/2\ of the 
                total volume of odorized propane in the producer class 
                and more than \1/2\ of the total volume of propane in 
                the retail marketer class; or
                    (B) persons representing more than \2/3\ of the 
                total volume of propane in produced or sold in the 
                United States.

SEC. 5. PROPANE EDUCATION AND RESEARCH COUNCIL.

    (a) Selection of Members.--
            (1) Selection by qualified industry organizations.--The 
        qualified industry organizations shall select all retail 
        marketer, public, and producer members of the Council.
            (2) Allocation.--The producer organizations shall select 
        the producer members of the Council, the retail marketer 
        organizations shall select retail marketer members, and all 
        qualified industry organizations shall select the public 
        members.
            (3) Vacancies.--Vacancies in unfinished terms of Council 
        members shall be filled in the same manner as original 
        appointments.
    (b) Representation.--In selecting members of the Council, the 
qualified industry organizations shall give due regard to selecting a 
Council that is representative of the industry, including 
representation of--
            (1) gas processors and oil refiners among producers;
            (2) interstate and intrastate operators among retail 
        marketers;
            (3) large and small companies among producers and retail 
        marketers, including agricultural cooperatives; and
            (4) all geographic regions of the country.
    (c) Membership.--
            (1) In general.--The Council shall consist of 21 members, 
        including--
                    (A) 9 members representing retail marketers;
                    (B) 9 members representing producers; and
                    (C) 3 public members.
            (2) Qualifications.--Each Council member representing 
        retail marketers or producers shall be a full-time employee or 
        owner of a business in the industry that the member represents 
        or a representative of an agricultural cooperative.
            (3) Disqualification.--No employee of a qualified industry 
        organization or other industry trade association shall serve as 
        a member of the Council, and no member of the Council may serve 
        concurrently as an officer of the board of directors of a 
        qualified industry organization or other industry trade 
        association.
            (4) Limited company representation.--Not more than 1 person 
        from any company (or affiliate of the company) may serve on the 
        Council at any given time.
    (d) Compensation.--
            (1) In general.--Subject to paragraph (2), Council members 
        shall receive no compensation for services performed or 
        reimbursement for expenses relating to services performed.
            (2) Exception for public members.--A public member may, on 
        request, be reimbursed for reasonable expenses directly related 
        to participation by the member in Council meetings.
    (e) Terms.--
            (1) Length of terms.--A Council member shall serve a term 
        of 3 years.
            (2) Number of terms.--A Council member may not serve more 
        than 2 full consecutive terms.
            (3) Maximum consecutive years.--A member filling an 
        unexpired term may serve not more than 7 consecutive years.
            (4) Return of former members.--A former member of the 
        Council may return to the Council only if the member has not 
        been a member for a period of 2 years.
            (5) Initial appointments.--Initial appointments to the 
        Council shall be for terms of 1, 2, and 3 years, and shall be 
        staggered to provide for the selection of 7 members each year.
    (f) Functions.--
            (1) In general.--The Council shall develop programs and 
        projects and enter into contracts or agreements for 
        implementing this Act, including programs to--
                    (A) enhance consumer and employee safety and 
                training;
                    (B) provide for research and development of clean 
                and efficient propane utilization equipment;
                    (C) inform and educate the public about safety and 
                other issues associated with the use of propane; and
                    (D) provide for the payment of the costs of 
                implementing subparagraphs (A) through (C) with funds 
                collected under this Act.
            (2) Coordination.--The Council shall coordinate activities 
        with industry trade associations and others as appropriate to 
        provide efficient delivery of services and to avoid unnecessary 
        duplication of activities.
    (g) Use of Funds.--
            (1) United states agriculture industry.--Not less than 5 
        percent of the funds collected through assessments under this 
        Act shall be used for programs and projects intended to benefit 
        the agriculture industry in the United States.
            (2) Coordination.--The Council shall coordinate the use of 
        funds under paragraph (1) with agriculture industry trade 
        associations and other organizations representing the 
        agriculture industry.
            (3) Use of propane as an over-the-road motor fuel.--The 
        percentage of funds collected through assessments under this 
        Act to be used in any year for projects relating to the use of 
        propane as an over-the-road motor fuel shall not exceed the 
        percentage of the total market for odorized propane that is 
        used as an over-the-road motor fuel, based on an historical 
        average of the use of propane as an over-the-road motor fuel 
        during the 3-year period preceding the year in which the funds 
        are used.
    (h) Priorities.--Issues related to research and development, 
safety, education, and training shall be given priority by the Council 
in the development of programs and projects.
    (i) Administration.--
            (1) Chairman.--The Council shall select a Chairman from 
        among the members of the Council.
            (2) Officers.--The Council shall select from among the 
        members of the Council such officers as the Council considers 
        necessary.
            (3) Committees.--The Council may establish committees and 
        subcommittees of the Council.
            (4) Rules and bylaws.--The Council shall adopt rules and 
        bylaws for the conduct of business and the implementation of 
        this Act.
            (5) Industry comment and recommendations.--The Council 
        shall establish procedures for the solicitation of industry 
        comment and recommendations on any significant plan, program, 
        or project to be funded by the Council.
            (6) Advisory committees.--The Council may establish 
        advisory committees of persons other than Council members.
    (j) Administrative Expenses.--
            (1) Limitation on expenses.--The administrative expenses of 
        operating the Council (not including costs incurred in the 
        collection of the assessment under section 6) plus amounts paid 
        under paragraph (2) shall not exceed 10 percent of the funds 
        collected by the Council in any fiscal year.
            (2) Reimbursement.--The Council shall annually reimburse 
        the Secretary for costs incurred by the United States relating 
        to the Council.
            (3) Limitation on reimbursement.--A reimbursement under 
        paragraph (2) for any fiscal year shall not exceed the amount 
        that the Secretary determines is twice the average annual 
        salary of employees of the Department of Energy.
    (k) Budget.--
            (1) Review and comment.--Prior to August 1 of each year, 
        the Council shall publish for public review and comment a 
        budget plan for the next calendar year, including the probable 
        costs of all programs, projects, and contracts and a 
        recommended rate of assessment sufficient to cover the costs.
            (2) Submission.--Following review and comment under 
        paragraph (1), the Council shall submit the proposed budget to 
        the Secretary and to Congress.
            (3) Recommendations by secretary.--The Secretary may 
        recommend any program or activity that the Secretary considers 
        appropriate.
    (l) Records.--
            (1) In general.--The Council shall keep minutes, books, and 
        records that clearly reflect all of the actions of the Council.
            (2) Public availability.--The Council shall make the 
        minutes, books, and records available to the public.
            (3) Audit.--The Council shall have the books audited by a 
        certified public accountant at least once each fiscal year and 
        at such other times as the Council may determine.
            (4) Copies.--Copies of an audit under paragraph (3) shall 
        be provided to all members of the Council, all qualified 
        industry organizations, and any other member of the industry on 
        request.
            (5) Notice.--The Council shall provide the Secretary with 
        notice of meetings.
            (6) Additional reports.--The Secretary may require the 
        Council to provide reports on the activities of the Council and 
        on compliance, violations, and complaints regarding the 
        implementation of this Act.
    (m) Public Access to Council Proceedings.--
            (1) In general.--All meetings of the Council shall be open 
        to the public.
            (2) Notice.--The Council shall provide the public at least 
        30 days' notice of Council meetings.
            (3) Minutes.--The minutes of all meetings of the Council 
        shall be made readily available to the public.
    (n) Annual Report.--
            (1) In general.--Each year the Council shall prepare and 
        make publicly available a report that includes an 
        identification and description of all programs and projects 
        undertaken by the Council during the previous year and those 
        planned for the upcoming year.
            (2) Resources.--The report shall detail the allocation and 
        planned allocation of Council resources for each program and 
        project.

SEC. 6. ASSESSMENTS.

    (a) In General.--The Council may levy an assessment on odorized 
propane in accordance with this section.
    (b) Amount.--
            (1) Initial assessment.--The Council shall set the initial 
        assessment at no greater than \1/10\ cent per gallon of 
        odorized propane sold and placed into commerce.
            (2) Subsequent assessments.--Subsequent to the initial 
        assessment, annual assessments shall be sufficient to cover the 
costs of the plans and programs developed by the Council.
            (3) Assessment maximum.--An assessment shall not be greater 
        than \1/2\ cent per gallon of odorized propane, unless approved 
        by a majority of those voting in a referendum in the producer 
        class and the retail marketer class.
            (4) Maximum increase.--An assessment may not be raised by 
        more than \1/10\ cent per gallon of odorized propane annually.
            (5) Ownership.--The owner of odorized propane at the time 
        of odorization, or at the time of import of odorized propane, 
        shall make the assessment based on the volume of odorized 
        propane sold and placed into commerce.
            (6) Due date.--Assessments shall be payable to the Council 
        on a monthly basis not later than the 25th of the month 
        following the month in which the assessment is made.
            (7) Exported propane.--Propane exported from the United 
        States is not subject to the assessment.
            (8) Late fee.--The Council may establish a late payment 
        charge and rate of interest to be imposed on a person that 
        fails to remit or pay to the Council any amount due under this 
        Act.
    (c) Alternative Collection Rules.--The Council may establish an 
alternative means of collecting the assessment if the Council 
determines that the alternative means is more efficient and effective.
    (d) Investment of Funds.--Pending disbursement pursuant to a 
program, plan, or project, the Council may invest funds collected 
through assessments, and any other funds received by the Council, only 
in--
            (1) obligations of the United States or an agency of the 
        United States;
            (2) general obligations of a State or political subdivision 
        of a State;
            (3) an interest-bearing account or certificate of deposit 
        of a bank that is a member of the Federal Reserve System; or
            (4) obligations fully guaranteed as to principal and 
        interest by the United States.
    (e) State Programs.--
            (1) In general.--The Council shall establish a program 
        coordinating the operation of the Council with the programs of 
        any State propane education and research council created by 
        State law, or any similar entity.
            (2) Coordination.--The coordination shall include a joint 
        or coordinated assessment collection process, a reduced 
        assessment, or an assessment rebate.
            (3) Reduced assessment or rebate.--A reduced assessment or 
        rebate shall be 20 percent of the regular assessment collected 
        in a State under this section.
            (4) Payment of assessment rebates.--An assessment rebate 
        may be paid only to--
                    (A) a State propane education and research council 
                created by State law or regulation that meets 
                requirements established by the Council for specific 
                programs approved by the Council; or
                    (B) a similar entity, such as a foundation 
                established by the retail propane gas industry in a 
                State that meets requirements established by the 
                Council for specific programs approved by the Council.

SEC. 7. COMPLIANCE.

    (a) In General.--The Council may bring a civil action in a United 
States district court to compel compliance with an assessment levied by 
the Council under this Act.
    (b) Costs.--A successful action for compliance under this section 
may require payment by the defendant of the costs incurred by the 
Council in bringing the compliance action.

SEC. 8. LOBBYING RESTRICTIONS.

    No funds collected by the Council shall be used in any manner to 
influence legislation or an election, but the Council may recommend to 
the Secretary changes in this Act or other statutes that would further 
the purposes of this Act.

SEC. 9. MARKET SURVEY AND CONSUMER PROTECTION.

    (a) Price Analysis.--
            (1) In general.--Not later than 2 years after establishment 
        of the Council and annually thereafter, the Secretary of 
        Commerce, using only data provided by the Energy Information 
        Administration and other public sources, shall prepare and make 
        available to the Council, the Secretary, and the public an 
        analysis of changes in the price of propane relative to other 
        energy sources.
            (2) Methodology.--
                    (A) In general.--The propane price analysis shall 
                compare indexed changes in the price of consumer grade 
                propane to a composite of indexed changes in the price 
                of residential electricity, residential natural gas, 
                and refiner price to end-users of number 2 fuel oil on 
                an annual national average basis.
                    (B) Rolling average price.--For purposes of 
                indexing changes in consumer grade propane, residential 
                electricity, residential natural gas, and end-user 
                number 2 fuel oil prices, the Secretary of Commerce 
                shall use a 5-year rolling average price beginning with 
                the year 4 years prior to the establishment of the 
                Council.
    (b) Authority To Restrict Activities.--
            (1) In general.--If in any year the 5-year average rolling 
        price index of consumer grade propane exceeds the 5-year 
        rolling average price composite index of residential 
        electricity, residential natural gas, and refiner price to end-
        users of number 2 fuel oil in an amount greater than 10.1 
        percent, the activities of the Council shall be restricted to 
        research and development, training, and safety matters.
            (2) Notification.--The Council shall inform Congress and 
        the Secretary of Energy of any restriction of activities under 
        this subsection.
            (3) Reanalysis.--On the expiration of each 180-day period 
        beginning on the date on which activities are restricted under 
        paragraph (1), the Secretary of Commerce shall conduct a new 
        propane price analysis described in subsection (a).
            (4) End of restriction.--Activities of the Council shall 
        continue to be restricted under this subsection until the 
        percentage described in paragraph (1) is 10.1 percent or less.

SEC. 10. PRICING.

    Notwithstanding any other provision of this Act, the price of 
propane shall be determined by market forces. The Council shall take no 
action, and no provision of this Act shall establish an agreement to, 
pass along to consumers the cost of the assessment provided for in 
section 6.

SEC. 11. RELATION TO OTHER PROGRAMS.

    Nothing in this Act shall preempt or supersede any other program 
relating to propane education and research organized and operated under 
the laws of the United States or any State.

SEC. 12. REPORTS.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, and not less than once every 2 years thereafter, the 
Secretary of Commerce shall prepare and submit to Congress and the 
Secretary a report examining whether operation of the Council, in 
conjunction with the cumulative effects of market changes and Federal 
programs, has had an effect on propane consumers, including 
residential, agriculture, process, and nonfuel users of propane.
    (b) Consideration by the Secretary of Commerce.--The Secretary of 
Commerce shall--
            (1) consider and, to the extent practicable, include in the 
        report submissions by propane consumers;
            (2) consider whether there have been long-term and short-
        term effects on propane prices as a result of Council 
        activities and Federal programs; and
            (3) consider whether there have been changes in the 
        proportion of propane demand attributable to various market 
        segments.
    (c) Recommendations.--To the extent that the report demonstrates 
that there has been an adverse effect on propane prices, the Secretary 
of Commerce shall include recommendations for reversing or mitigating 
the effect.
    (d) Frequent Reports.--On petition by an affected party or on 
request by the Secretary of Energy, the Secretary of Commerce may 
prepare and submit the report required by this section at less than 2-
year intervals.