[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3985 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 3985

  To amend the Internal Revenue Code of 1986 to provide for a second 
      generation biofuel producer credit, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 2, 2009

Mr. Van Hollen introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to provide for a second 
      generation biofuel producer credit, 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 ``Second Generation Biofuel Producer 
Tax Credit Act of 2009''.

SEC. 2. SECOND GENERATION BIOFUEL PRODUCER CREDIT.

    (a) Credit Amount Determined Based on BTU Content of Fuel.--
Subparagraph (B) of section 40(b)(6) of the Internal Revenue Code of 
1986 is amended to read as follows:
                    ``(B) Applicable amount.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `applicable 
                        amount' means, with respect to any type of 
                        second generation biofuel, the dollar amount 
                        which bears the same ratio to $1.01 as the BTU 
                        content of such type of fuel bears to the BTU 
                        content of ethanol. For purposes of the 
                        preceding sentence, the types of second 
                        generation biofuel and the BTU content of such 
                        types shall be determined in accordance with 
                        the table prescribed under clause (ii).
                            ``(ii) BTU content determined by 
                        secretary.--The Secretary, after consultation 
                        with the Secretary of Energy, shall prescribe a 
                        table which lists the types of second 
                        generation biofuel and the BTU content of each 
                        such type.
                            ``(iii) Coordination with alcohol 
                        credits.--In the case of second generation 
                        biofuel which is alcohol, the applicable amount 
                        determined under clause (i) shall be reduced by 
                        the sum of--
                                    ``(I) the amount of the credit in 
                                effect for such alcohol under 
                                subsection (b)(1) (without regard to 
                                subsection (b)(3)) at the time of the 
                                qualified second generation biofuel 
                                production, plus
                                    ``(II) in the case of ethanol, the 
                                amount of the credit in effect under 
                                subsection (b)(4) at the time of such 
                                production.''.
    (b) Expansion of Qualified Fuels.--
            (1) In general.--Subclause (I) of section 40(b)(6)(E)(i) of 
        such Code is amended to read as follows:
                                    ``(I) is derived solely from 
                                qualified feedstocks, and''.
            (2) Qualified feedstock.--Paragraph (6) of section 40(b) of 
        such Code is amended by redesignating subparagraphs (F), (G), 
        and (H) as subparagraphs (G), (H), and (I), respectively, and 
        by inserting after subparagraph (E) the following new 
        subparagraph:
                    ``(F) Qualified feedstock.--For purposes of this 
                paragraph, the term `qualified feedstock' means--
                            ``(i) any lignocellulosic or hemicellulosic 
                        matter that is available on a renewable or 
                        recurring basis, and
                            ``(ii) any cultivated algae, cyanobacteria, 
                        or lemna.''.
            (3) Conforming amendments.--
                    (A) Section 40 of such Code is amended--
                            (i) by striking ``cellulosic biofuel'' each 
                        place it appears in the text thereof and 
                        inserting ``second generation biofuel'',
                            (ii) by striking ``Cellulosic'' in the 
                        headings of subsections (b)(6), (b)(6)(E), and 
                        (d)(3)(D) and inserting ``Second generation'', 
                        and
                            (iii) by striking ``cellulosic'' in the 
                        headings of subsections (b)(6)(C), (b)(6)(D), 
                        (b)(6)(F), (d)(6), and (e)(3) and inserting 
                        ``second generation''.
                    (B) Clause (iii) of section 40(b)(6)(E) of such 
                Code, as redesignated by paragraph (2), is amended by 
                striking ``Such term shall not'' and inserting ``The 
                term `second generation biofuel' shall not''.
                    (C) Paragraph (1) of section 4101(a) of such Code 
                is amended by striking ``cellulosic biofuel'' and 
                inserting ``second generation biofuel''.
    (c) Exclusion of Fuels Produced From Coprocessing With Nonqualified 
Feedstocks.--Subparagraph (E) of section 40(b)(6) of such Code is 
amended by adding at the end the following new clause:
                            ``(iii) Exclusion of fuels produced from 
                        coprocessing with nonqualified feedstocks.--The 
                        term `second generation biofuel' shall not 
                        include any fuel derived from coprocessing a 
                        qualified feedstock with any feedstock which is 
                        not a qualified feedstock.''.
    (d) Exclusion of Unprocessed Fuels.--Subparagraph (E) of section 
40(b)(6) of such Code, as amended by subsection (c), is amended by 
adding at the end the following new clause:
                            ``(iv) Exclusion of unprocessed fuels.--The 
                        term `second generation biofuel' shall not 
                        include any fuel if--
                                    ``(I) more than 4 percent of such 
                                fuel (determined by weight) is any 
                                combination of water and sediment, or
                                    ``(II) the ash content of such fuel 
                                is more than 1 percent (determined by 
                                weight).''.
    (e) Liquid Fuel Defined.--
            (1) In general.--Paragraph (6) of section 40(b) of such 
        Code, as amended by subsection (b), is amended by redesignating 
        subparagraphs (G), (H), and (I) as subparagraphs (H), (I), and 
        (J), respectively, and by inserting after subparagraph (F) the 
        following new subparagraph:
                    ``(G) Liquid fuel.--The term `liquid fuel' shall 
                not include any fuel unless such fuel would be a liquid 
                at room temperature after extraction of all water from 
                the fuel.''.
            (2) Application to alcohol mixture credit.--Paragraph (2) 
        of section 40(d) of such Code is amended by inserting ``, 
        within the meaning of subsection (b)(6)(G),'' after ``liquid 
        fuel (other than gasoline)''.
            (3) Application to renewable diesel.--Paragraph (3) of 
        section 40A(f) of such Code is amended by inserting ``(within 
        the meaning of section 40(b)(6)(G))'' after ``liquid fuel''.
    (f) Registration of Fuels.--Subparagraph (I) of section 40(b)(6) of 
such Code, as redesignated by subsections (b) and (e), is amended to 
read as follows:
                    ``(I) Registration requirements.--No credit shall 
                be determined under this paragraph with respect to any 
                second generation biofuel produced by the taxpayer 
                unless--
                            ``(i) such taxpayer is registered with the 
                        Secretary as a producer of second generation 
                        biofuel under section 4101, and
                            ``(ii) such taxpayer provides the Secretary 
                        such information with respect to such second 
                        generation biofuel as the Secretary may (after 
                        consultation with the Secretary of Energy and 
                        the Administrator of the Environmental 
                        Protection Agency) require, including--
                                    ``(I) the type of such second 
                                generation biofuel,
                                    ``(II) the feedstocks from which 
                                such second generation biofuel is 
                                derived, and
                                    ``(III) the BTU content of such 
                                second generation biofuel.''.
    (g) Application of Biofuel Reforms to Bonus Depreciation for 
Biofuel Plant Property.--
            (1) In general.--Subparagraph (A) of section 168(l)(2) of 
        such Code is amended by striking ``solely to produce cellulosic 
        biofuel'' and inserting ``solely to produce second generation 
        biofuel (as defined in section 40(b)(6)(E)''.
            (2) Conforming amendments.--Subsection (l) of section 168 
        of such Code is amended--
                    (A) by striking ``cellulosic biofuel'' each place 
                it appears in the text thereof and inserting ``second 
                generation biofuel'',
                    (B) by striking paragraph (3) and redesignating 
                paragraphs (4) through (8) as paragraphs (3) through 
                (7), respectively,
                    (C) by striking ``Cellulosic'' in the heading of 
                such subsection and inserting ``Second Generation'', 
                and
                    (D) by striking ``cellulosic'' in the heading of 
                paragraph (2) and inserting ``second generation''.
    (h) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to fuels sold or 
        used after the date of the enactment of this Act.
            (2) Application to bonus depreciation.--The amendments made 
        by subsection (g) shall apply to property placed in service 
        after the date of the enactment of this Act.
            (3) Temporary rule for determining credit amount based on 
        btu content of fuel.--With respect to any fuel sold or used 
        after the date of the enactment of this Act and before the date 
        on which the Secretary prescribes the table described in clause 
        (ii) of section 40(b)(6)(B) of the Internal Revenue Code of 
        1986 (as amended by this Act), clause (i) of such section shall 
        be applied by treating all second generation biofuel as though 
        it were ethanol.
                                 <all>