[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3610 Engrossed in House (EH)]


  2d Session

                               H. R. 3610

_______________________________________________________________________

                                 AN ACT

To authorize and facilitate a program to enhance training, research and 
development, energy conservation and efficiency, and consumer education 
 in the oilheat industry for the benefit of oilheat consumers and the 
                    public, and for other purposes.
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
105th CONGRESS
  2d Session
                                H. R. 3610

_______________________________________________________________________

                                 AN ACT


 
To authorize and facilitate a program to enhance training, research and 
development, energy conservation and efficiency, and consumer education 
 in the oilheat industry for the benefit of oilheat 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 ``National Oilheat Research Alliance 
Act of 1998''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) oilheat is an important commodity relied upon by 
        approximately 30,000,000 Americans annually as an efficient and 
        economical energy source for commercial and residential space 
        and hot water heating;
            (2) oilheat equipment operates at efficiencies among the 
        highest of any space heating energy source, reducing fuel costs 
        and making oilheat an economical means of space heating;
            (3) the production, distribution, and marketing of oilheat 
        and oilheat equipment plays a significant role in the economy 
        of the United States accounting for approximately 
        $12,900,000,000 in expenditures annually and employing millions 
        of Americans in all aspects of the industry;
            (4) only very limited Federal resources have been made 
        available for oilheat research, development, safety, training, 
        and education efforts, to the detriment of both the oilheat 
        industry and its 30,000,000 consumers; and
            (5) the cooperative development, self-financing, and 
        implementation of a coordinated national oilheat industry 
        program of research and development, training, and consumer 
        education is necessary and important for the welfare of the 
        oilheat industry, including wholesale distributors and retail 
        marketers, as well as for the general economy of the United 
        States and the millions of Americans who rely on oilheat for 
        commercial and residential space and hot water heating.

SEC. 3. DEFINITIONS.

    For the purposes of this Act--
            (1) the term ``Alliance'' means a National Oilheat Research 
        Alliance created pursuant to section 4 of this Act;
            (2) the term ``consumer education'' means the provision of 
        information that will assist consumers and other persons in 
        making evaluations and decisions regarding oilheat and other 
        nonindustrial commercial or residential space or hot water 
        heating fuels;
            (3) the term ``exchange'' means an agreement that entitles 
        each party or its customers to receive product from the other 
        party and requires only an insubstantial portion of the volumes 
        involved in the exchange to be settled in cash or property 
        other than the product;
            (4) the term ``industry'' means those persons involved in 
        the production, transportation, and sale of oilheat, and in the 
        manufacture and distribution of oilheat utilization equipment, 
        in the United States, but such term does not include the 
        ultimate consumers of oilheat;
            (5) the term ``industry trade association'' means an 
        organization exempt from tax, under section 501(c) (3) or (6) 
        of the Internal Revenue Code of 1986, representing participants 
        in the industry;
            (6) the term ``No. 1 distillate'' means fuel oil classified 
        as No. 1 distillate by the American Society for Testing and 
        Materials;
            (7) the term ``No. 2 dyed distillate'' means fuel oil 
        classified as No. 2 distillate by the American Society for 
        Testing and Materials which is indelibly dyed in accordance 
        with regulations prescribed by the Secretary of the Treasury 
        pursuant to section 4082(a)(2) of the Internal Revenue Code of 
        1986;
            (8) the term ``oilheat'' means--
                    (A) No. 1 distillate; or
                    (B) No. 2 dyed distillate,
        which is used as a fuel for nonindustrial commercial or 
        residential space or hot water heating;
            (9) the term ``public member'' means a member of the 
        Alliance described in section 5(c)(6);
            (10) the term ``qualified industry organization'' means the 
        National Association for Oilheat Research and Education or a 
        successor organization;
            (11) the term ``qualified State association'' means the 
        industry trade association or other organization that the 
        qualified industry organization, or, after its establishment 
        under this Act, the Alliance, determines best represents retail 
        marketers in a State;
            (12) the term ``retail marketer'' means a person engaged 
        primarily in the sale of oilheat to the ultimate consumer;
            (13) the term ``Secretary'' means the Secretary of Energy; 
        and
            (14) the term ``wholesale distributor'' means a person 
        who--
                    (A) produces;
                    (B) imports; or
                    (C) transports across State boundaries and among 
                local marketing areas, and
        No. 1 distillate or No. 2 dyed distillate, and sells such 
        distillate to another person who does not produce, import, or 
        transport distillates as described in this paragraph.

SEC. 4. REFERENDA.

    (a) Creation of Program.--The industry, through the qualified 
industry organization, may conduct, at its own expense, a referendum 
among retail marketers and wholesale distributors for the creation of a 
National Oilheat Research Alliance. The Alliance, if established, shall 
reimburse the qualified industry organization for the cost of 
referendum accounting and documentation. Such referendum shall be 
conducted by an independent auditing firm. Voting rights of a retail 
marketer in such referendum shall be based on the volume of oilheat 
sold in a State by the retail marketer in the previous calendar year or 
other representative period. Voting rights of a wholesale distributor 
in such referendum shall be based on the volume of No. 1 distillate and 
No. 2 dyed distillate sold in a State by the wholesale distributor in 
the previous calendar year or other representative period, weighted by 
the ratio of the total volume of No. 1 distillate and No. 2 dyed 
distillate sold for nonindustrial commercial and residential space and 
hot water heating in that State to the total volume of No. 1 distillate 
and No. 2 dyed distillate sold in that State. Upon approval of those 
persons representing two-thirds of the total volume of oilheat voted in 
the retail marketer class and two-thirds of the total weighted volume 
of No. 1 distillate and No. 2 dyed distillate voted in the wholesale 
distributor class, the Alliance shall be established, and shall be 
authorized to levy assessments in accordance with section 6. All 
persons voting in the referendum shall certify to the independent 
auditing firm the volume of oilheat, No. 1 distillate, or No. 2 dyed 
distillate represented by their vote. Except as provided in subsection 
(b), a State shall not participate in the Alliance if less than 50 
percent of the retail marketer vote in that State, subject to the 
volumetric voting rules established by this subsection, is in favor of 
the creation of the Alliance. A qualified State association may notify 
the qualified industry organization within 90 days after the date of 
the enactment of this Act in writing that a referendum under this 
subsection will not be conducted in that State.
    (b) Subsequent State Participation.--A State that has not 
participated initially in the Alliance may subsequently elect to 
participate by conducting a referendum in accordance with subsection 
(a).
    (c) Termination or Suspension.--On the Alliance's own initiative, 
or on petition to the Alliance by retail marketers and wholesale 
distributors representing 35 percent of the volume of oilheat or 
weighted No. 1 distillate and No. 2 dyed distillate in each class, the 
Alliance shall, at its own expense, hold a referendum, to be conducted 
by an independent auditing firm selected by the Alliance, to determine 
whether the industry favors termination or suspension of the Alliance. 
Termination or suspension shall not take effect unless it is approved 
by persons representing more than one-half of the total volume of 
oilheat voted in the retail marketer class and more than one-half of 
the total volume of weighted No. 1 distillate and No. 2 dyed distillate 
voted in the wholesale distributor class, or is approved by persons 
representing more than two-thirds of the total volume of fuel voted in 
either such class.

SEC. 5. NATIONAL OILHEAT RESEARCH ALLIANCE.

    (a) Selection of Members.--Except as otherwise provided in 
subsection (c)(3), the qualified industry organization shall select all 
members of the Alliance. The qualified industry organization shall 
select a member representing a State from a list of nominees submitted 
by that State's qualified State association. Vacancies in unfinished 
terms of Alliance members shall be filled in the same manner as were 
the original appointments.
    (b) Representation.--In selecting members of the Alliance, the 
qualified industry organization shall give due regard to selecting a 
Alliance that is representative of the industry, including 
representation of--
            (1) interstate and intrastate operators among retail 
        marketers;
            (2) wholesale distributors of No. 1 distillate and No. 2 
        dyed distillate;
            (3) large and small companies among wholesale distributors 
        and retail marketers; and
            (4) diverse geographic regions of the country.
    (c) Membership.--The membership of the Alliance shall be as 
follows:
            (1) One member representing each State with oilheat sales 
        in excess of 32,000,000 gallons per year.
            (2) If less than 24 States are represented under paragraph 
        (1), one member representing each of the States with the 
        highest volume of annual oilheat sales as necessary to cause 
        the total number of States represented under paragraph (1) and 
        this paragraph combined to equal 24.
            (3) 5 representatives of retail marketers, one each to be 
        selected by the qualified State associations of the 5 States 
        with the highest volume of annual oilheat sales.
            (4) 5 additional representatives of retail marketers.
            (5) 21 representatives of wholesale distributors.
            (6) 6 public members, who shall be representatives of 
        significant users of oilheat, the oilheat research community, 
        or other groups knowledgeable about oilheat.
Other than the public members, Alliance members shall be full-time 
employees or owners of businesses in the industry, except that members 
described in paragraphs (3), (4), and (5) may be employees of the 
qualified industry organization or an industry trade association.
    (d) Compensation.--Alliance members shall receive no compensation 
for their services, nor shall Alliance members be reimbursed for 
expenses relating to their service, except that public members, upon 
request, may be reimbursed for reasonable expenses directly related to 
their participation in Alliance meetings.
    (e) Terms.--Alliance members shall serve terms of 3 years and may 
serve not more than 2 full consecutive terms. Members filling unexpired 
terms may serve not more than a total of 7 consecutive years. Former 
members of the Alliance may be returned to the Alliance if they have 
not been members for a period of 2 years. Initial appointments to the 
Alliance shall be for terms of 1, 2, and 3 years, as determined by the 
qualified industry organization, staggered to provide for the 
subsequent selection of one-third of the members each year.
    (f) Functions.--(1) The Alliance shall develop programs and 
projects and enter into contracts or agreements for implementing this 
Act, including programs--
            (A) to enhance consumer and employee safety and training;
            (B) to provide for research, development, and demonstration 
        of clean and efficient oilheat utilization equipment; and
            (C) for consumer education,
and may provide for the payment of the costs thereof with funds 
collected pursuant to this Act. The Alliance shall coordinate its 
activities with industry trade associations and others as appropriate 
to provide efficient delivery of services and to avoid unnecessary 
duplication of activities.
    (2) Research, development, and demonstration activities authorized 
under paragraph (1)(B) shall include all activities incidental to 
research, development, and demonstration of clean and efficient oilheat 
utilization equipment. Such activities include obtaining a patent, 
including payment of attorney's fees for making and perfecting a patent 
application. Such activities do not include research, development, and 
demonstration of oilheat utilization equipment with respect to which 
technically feasible and commercially feasible operations have been 
verified, except that funds may be provided for improvements to 
existing equipment until the technical feasibility and commercial 
feasibility of the operation of those improvements have been verified.
    (3) Activities authorized under paragraph (1)(A) or (B) shall not 
include advertising, promotions, or consumer surveys in support of 
advertising or promotions.
    (g) Priorities.--Issues related to research, development, and 
demonstration, safety, consumer education, and training shall be given 
priority by the Alliance in the development of its programs and 
projects.
    (h) Administration.--The Alliance shall select from among its 
members a Chairman and other officers as necessary, may establish and 
authorize committees and subcommittees of the Alliance to take specific 
actions the Alliance is authorized to take, and shall adopt rules and 
bylaws for the conduct of business and the implementation of this Act. 
The Alliance shall establish procedures for the solicitation of 
industry comment and recommendations on any significant plans, 
programs, and projects to be funded by the Alliance. The Alliance may 
establish advisory committees of persons other than Alliance members. 
Each member of the Alliance shall have 1 vote in matters before the 
Alliance.
    (i) Administrative Expenses.--(1) The administrative expenses of 
operating the Alliance (not including costs incurred in the collection 
of the assessment pursuant to section 6) plus amounts paid under 
paragraph (2) shall not exceed 7 percent of the funds collected in any 
fiscal year, except that during the first year of its operation such 
expenses and amounts shall not exceed 10 percent of such funds.
    (2) The Alliance shall annually reimburse the Secretary for costs 
incurred by the Federal Government relating to the Alliance. Such 
reimbursement for any fiscal year shall not exceed the amount that the 
Secretary determines is 2 times the average annual salary of 1 employee 
of the Department of Energy.
    (j) Budget.--Before August 1 each year, the Alliance 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. 
Following this review and comment, the Alliance shall submit the 
proposed budget to the Secretary and to the Congress. The Secretary may 
recommend programs and activities the Secretary considers appropriate. 
The Alliance shall not implement a proposed budget until after the 
expiration of 60 days after submitting the proposed budget.
    (k) Records; Audits.--The Alliance shall keep books and records 
that clearly reflect all of the acts and transactions of the Alliance 
and make public such information. The books of the Alliance, including 
fee assessment reports and applications for refunds, shall be audited 
by a certified public accountant at least once each fiscal year and at 
such other times as the Alliance may designate. Copies of such audit 
shall be provided to the Secretary, all members of the Alliance, the 
qualified industry organization, and to other members of the industry 
upon request. The Alliance shall establish policies and procedures for 
auditing compliance with this Act that shall conform with generally 
accepted accounting principles.
    (l) Public Access to Alliance Proceedings.--(1) All meetings of the 
Alliance shall be open to the public after at least 30 days advance 
public notice.
    (2) The minutes of all meetings of the Alliance shall be made 
available to and readily accessible by the public.
    (m) Annual Report.--Each year the Alliance shall prepare and make 
publicly available a report which includes an identification and 
description of all programs and projects undertaken by the Alliance 
during the previous year as well as those planned for the coming year. 
Such report shall also detail the allocation or planned allocation of 
Alliance resources for each such program and project.
    (n) Calculation of Oilheat Sales.--For purposes of this section, 
the volume of oilheat sold annually in a State shall be determined on 
the basis of information provided by the Energy Information 
Administration with respect to the preceding calendar year or other 
equivalent period.

SEC. 6. ASSESSMENTS.

    (a) Amount.--The assessment shall be set at two tenths of 1 cent 
per gallon of No. 1 distillate and No. 2 dyed distillate.
    (b) Collection Rules.--The assessment shall be collected upon the 
sale of No. 1 distillate and No. 2 dyed distillate by a wholesale 
distributor to a person other than a wholesale distributor, including a 
sale made pursuant to an exchange. The wholesale distributor shall be 
responsible for payment of the assessment to the Alliance and shall 
provide to the Alliance certification of the volume of fuel sold. A 
person who has no ownership interest in No. 1 distillate or No. 2 dyed 
distillate shall not be responsible for payment of an assessment under 
this section. Assessments shall be made on all No. 1 distillate and No. 
2 dyed distillate sold in a State that is participating in the 
Alliance, and are payable to the Alliance on a quarterly basis. Any No. 
1 distillate or No. 2 dyed distillate previously assessed shall not be 
subject to further assessment. A wholesale distributor who fails within 
one year of sale to receive payments from a purchaser for No. 1 
distillate or No. 2 dyed distillate sold may apply for a refund 
directly from the Alliance. Such refund may not exceed the amount of 
the assessments levied upon the No. 1 distillate and No. 2 dyed 
distillate for which payment was not received. The owner of No. 1 
distillate and No. 2 dyed distillate imported after the point of sale 
described in the first sentence of this subsection shall be responsible 
for payment of the assessment to the Alliance at the point at which the 
product enters the United States, and shall provide to the Alliance 
certification of the volume of fuel so imported.
    (c) Exclusions.--No. 1 distillate and No. 2 dyed distillate sold 
for uses other than oilheat are excluded from the assessment. The 
Alliance shall establish rules and procedures for refunding to 
wholesale distributors, and to retail marketers or other end users who 
purchase from a wholesale distributor, assessments collected on 
excluded gallons.
    (d) Alternative Collection Rules.--The Alliance may establish, or 
approve a State's request for, an alternative means of collecting the 
assessment if another means is found to be more efficient and 
effective. The Alliance may establish a late payment charge and rate of 
interest to be imposed on any person who fails to remit or pay to the 
Alliance any amount due under this Act.
    (e) Investment of Funds.--Pending disbursement pursuant to a 
program, plan, or project, the Alliance may invest funds collected 
through assessments, and any other funds received by the Alliance, only 
in obligations of the United States or any agency thereof, in general 
obligations of any State or any political subdivision thereof, in any 
interest-bearing account or certificate of deposit of a bank that is a 
member of the Federal Reserve System, or in obligations fully 
guaranteed as to principal and interest by the United States.
    (f) State Programs.--
            (1) Coordination.--The Alliance shall establish a program 
        coordinating the operation of the Alliance with those of any 
        similar State, local, or regional program created by State law 
        or regulation, or similar entity.
            (2) Funds made available to qualified state associations.--
                    (A) Base amount.--The Alliance shall make available 
                to each State's qualified State association 15 percent 
                of the funds raised in the State pursuant to the 
                assessment under this section.
                    (B) Request for additional amount.--A qualified 
                State association may request that the Alliance provide 
                any portion of the remaining 85 percent of the funds 
                raised in the State. A request under this subparagraph 
                shall--
                            (i) specify the amount of funds requested;
                            (ii) describe in detail the specific uses 
                        for which the requested funds are sought;
                            (iii) include a commitment to comply with 
                        this Act in using the requested funds; and
                            (iv) be made publicly available.
                The Alliance shall not provide any funds in response to 
                a request under this subparagraph unless it determines 
                that the funds will be used to directly benefit the 
                oilheat industry. The Alliance shall monitor the use of 
                funds provided under this subparagraph, and shall 
                impose whatever terms, conditions, and reporting 
                requirements it considers necessary to ensure 
                compliance with this Act.

SEC. 7. COMPLIANCE.

    The Alliance may bring suit in Federal court to compel compliance 
with an assessment levied by the Alliance under this Act. A successful 
action for compliance under this section may also require payment by 
the defendant of the costs incurred by the Alliance in bringing such 
action.

SEC. 8. LOBBYING RESTRICTIONS.

    No funds collected by the Alliance under section 6 shall be used in 
any manner for influencing legislation or elections, except that the 
Alliance may use such funds to recommend to the Secretary changes in 
this Act or other statutes that would further the purposes of this Act.

SEC. 9. DISCLOSURE.

    Any consumer education activity undertaken with funds provided by 
the Alliance shall include a statement that the activities were 
supported, in whole or in part, by the Alliance.

SEC. 10. VIOLATIONS.

    (a) Prohibition.--Any consumer education activity, undertaken with 
funds collected by the Alliance under section 6, that includes--
            (1) a reference to a private brand name;
            (2) a false or unwarranted claim on behalf of oilheat or 
        related products; or
            (3) a reference with respect to the attributes or use of 
        any competing product,
is prohibited.
    (b) Filing and Transmittal of Complaints.--A public utility 
aggrieved by a violation described in subsection (a) may file a 
complaint. Such complaint shall be transmitted concurrently to the 
Alliance and to any qualified State association undertaking the 
consumer education activity with respect to which the complaint is 
made. Upon receipt of a complaint under this subsection, the Alliance, 
and any qualified State association undertaking the consumer education 
activity with respect to which the complaint is made, shall cease those 
consumer education activities until--
            (1) the complaint is withdrawn; or
            (2) a court of jurisdiction has determined that the 
        consumer eduction activity complained of does not constitute a 
        violation of subsection (a).
    (c) Resolution by Parties.--Not later than 10 days after a 
complaint is filed and transmitted under subsection (b), the 
complaining party, the Alliance, and any qualified State association 
undertaking the consumer education activity with respect to which the 
complaint is made shall meet to attempt to resolve the complaint. If 
the issues in dispute are resolved in those discussions, the 
complainant shall withdraw its complaint.
    (d) Judicial Review.--A public utility filing a complaint under 
this section, the Alliance, a qualified State association undertaking 
the consumer education activity with respect to which a complaint under 
this section is made, or any aggrieved person, may seek relief under 
this section in Federal court. A public utility filing a complaint 
under this section shall be entitled to temporary and injunctive relief 
enjoining the consumer education activity with respect to which a 
complaint under this section is made until--
            (1) the complaint is withdrawn; or
            (2) a court of jurisdiction has determined that the 
        consumer eduction activity complained of does not constitute a 
        violation of subsection (a).
    (e) Attorneys Fees.--In any case in Federal court in which the 
court grants a public utility injunctive relief under subsection (d), 
the public utility shall be entitled to recover its attorneys fees from 
the Alliance and any qualified State association undertaking the 
consumer education activity with respect to which a complaint under 
this section is made. In any case under subsection (d) in which the 
court determines a complaint under subsection (b) to be frivolous and 
without merit, the prevailing party shall be entitled to recover its 
attorneys fees.

SEC. 11. SUNSET.

    This Act shall cease to be effective 4 years after the date on 
which the Alliance is established.

            Passed the House of Representatives October 10, 1998.

            Attest:

                                                                 Clerk.