[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2231 Introduced in House (IH)]

112th CONGRESS
  1st Session
                                H. R. 2231

To amend the Internal Revenue Code of 1986 to terminate the ethanol tax 
                    credits, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 16, 2011

   Mrs. Noem (for herself, Mr. Berg, and Mr. Schock) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
  and in addition to the Committee on the Budget, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to terminate the ethanol tax 
                    credits, 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 ``Ethanol Modernization and Deficit 
Reduction Act''.

SEC. 2. TERMINATION OF ETHANOL TAX CREDITS.

    (a) Excise Tax Credit and Direct Payments.--Sections 6426(b)(6) and 
6427(e)(6)(A) of the Internal Revenue Code of 1986 are each amended by 
striking ``December 31, 2011'' and inserting ``June 30, 2011''.
    (b) Income Tax Credit.--Paragraph (1) of section 40(e) of such Code 
is amended--
            (1) by striking ``December 31, 2011'' in subparagraph (A) 
        and inserting ``June 30, 2011'', and
            (2) by striking ``January 1, 2012'' in subparagraph (B) and 
        inserting ``July 1, 2011''.
    (c) Effective Date.--The amendments made by this section shall 
apply to any sale, use, or removal for any period after June 30, 2011.

SEC. 3. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL VEHICLE 
              REFUELING PROPERTY CREDIT.

    (a) Extension.--Subsection (g) of section 30C of the Internal 
Revenue Code of 1986 is amended by striking ``placed in service--'' and 
all that follows and inserting ``placed in service after the earlier of 
December 31, 2016, or the date on which the Secretary certifies that at 
least 53,000 qualified alternative fuel refueling properties (other 
than properties described in subsection (c)(2)(C)) have been placed in 
service.''.
    (b) Only Certain Ethanol Blends Eligible for Credit.--Subparagraph 
(A) of section 30C(c)(2) of the Internal Revenue Code of 1986 is 
amended to read as follows:
                    ``(A) Any fuel--
                            ``(i) at least 85 percent of the volume of 
                        which consists of one or more of the following: 
                        natural gas, compressed natural gas, liquified 
                        natural gas, liquefied petroleum gas, or 
                        hydrogen, or
                            ``(ii) at least 85 percent of the volume of 
                        which consists of--
                                    ``(I) ethanol, or
                                    ``(II) ethanol and gasoline or one 
                                or more of the fuels described in 
                                clause (i), but only if at least 15 
                                percent and not more than 85 percent of 
                                the volume of such fuel consists of 
                                ethanol.''.
    (c) Credit for Dual-Use Refueling Property.--Subsection (e) of 
section 30C of the Internal Revenue Code of 1986 is amended by adding 
at the end the following new paragraph:
            ``(6) Dual-use refueling property.--
                    ``(A) In general.--In the case of any dual-use 
                refueling property, 100 percent of the cost of such 
                property shall be treated as qualified alternative fuel 
                refueling property if the taxpayer certifies, in such 
                time and manner as the Secretary shall prescribe, that 
                such property will be used in more than a de minimis 
                capacity for the purposes described in section 
                179A(d)(3)(A) (applied as specified in subsection 
                (c)(2)).
                    ``(B) Recapture.--If at any time within 5 years 
                after the date of the certification under subparagraph 
                (A) the dual-use refueling property ceases to be used 
                as required under such subparagraph, 100 percent of the 
                cost of such property shall be subject to recapture 
                under paragraph (5).
                    ``(C) Dual-use refueling property.--For purposes of 
                this paragraph, the term `dual-use refueling property' 
                means property that is both qualified alternative fuel 
                vehicle refueling property and property used--
                            ``(i) to store or dispense fuels not 
                        described in subsection (c)(2), or
                            ``(ii) to store fuels described in 
                        subsection (c)(2) for any purpose other than 
                        delivery of such fuel into the fuel tank of a 
                        motor vehicle.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after June 30, 2011.

SEC. 4. EXTENSION OF CELLULOSIC BIOFUEL PRODUCER CREDIT THROUGH 2014.

    Subparagraph (H) of section 40(b)(6) of the Internal Revenue Code 
of 1986 is amended by striking ``January 1, 2013'' and inserting 
``January 1, 2015''.

SEC. 5. EXTENSION OF SPECIAL DEPRECIATION ALLOWANCE FOR CELLULOSIC 
              BIOFUEL PLANT PROPERTY.

    Subparagraph (D) of section 168(l)(2) of the Internal Revenue Code 
of 1986 is amended by striking ``January 1, 2013'' and inserting 
``January 1, 2015''.

SEC. 6. ALGAE TREATED AS A QUALIFIED FEEDSTOCK FOR PURPOSES OF THE 
              CELLULOSIC BIOFUEL PRODUCER CREDIT, ETC.

    (a) In General.--Subclause (I) of section 40(b)(6)(E)(i) of the 
Internal Revenue Code of 1986 is amended to read as follows:
                                    ``(I) is derived solely by, or 
                                from, qualified feedstocks, and''.
    (b) Qualified Feedstock; Special Rules for Algae.--Paragraph (6) of 
section 40(b) of the Internal Revenue Code of 1986, as amended by this 
Act, is amended by redesignating subparagraphs (F) and (G) as 
subparagraphs (H) and (I), respectively, and by inserting after 
subparagraph (E) the following new subparagraphs:
                    ``(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.
                    ``(G) Special rules for algae.--In the case of fuel 
                which is derived by, or from, feedstock described in 
                subparagraph (F)(ii) and which is sold by the taxpayer 
                to another person for refining by such other person 
                into a fuel which meets the requirements of 
                subparagraph (E)(i)(II)--
                            ``(i) such sale shall be treated as 
                        described in subparagraph (C)(i),
                            ``(ii) such fuel shall be treated as 
                        meeting the requirements of subparagraph 
                        (E)(i)(II) in the hands of such taxpayer, and
                            ``(iii) except as provided in this 
                        subparagraph, such fuel (and any fuel derived 
                        from such fuel) shall not be taken into account 
                        under subparagraph (C) with respect to the 
                        taxpayer or any other person.''.
    (c) Algae Treated as a Qualified Feedstock for Purposes of Bonus 
Depreciation for Biofuel Plant Property.--
            (1) In general.--Subparagraph (A) of section 168(l)(2) of 
        the Internal Revenue Code of 1986 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, as amended by this Act, 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''.
    (d) Conforming Amendments.--
            (1) Section 40 of the Internal Revenue Code of 1986, as 
        amended by this Act, is amended--
                    (A) by striking ``cellulosic biofuel'' each place 
                it appears in the text thereof and inserting ``second 
                generation biofuel'',
                    (B) by striking ``Cellulosic'' in the headings of 
                subsections (b)(6), (b)(6)(E), and (d)(3)(D) and 
                inserting ``Second generation'', and
                    (C) by striking ``cellulosic'' in the headings of 
                subsections (b)(6)(C), (b)(6)(D), (b)(6)(H), (d)(6), 
                and (e)(3) and inserting ``second generation''.
            (2) Clause (ii) of section 40(b)(6)(E) of such Code is 
        amended by striking ``Such term shall not'' and inserting ``The 
        term `second generation biofuel' shall not''.
            (3) Paragraph (1) of section 4101(a) of such Code is 
        amended by striking ``cellulosic biofuel'' and inserting 
        ``second generation biofuel''.
    (e) 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 (c) shall apply to property placed in service 
        after the date of the enactment of this Act.

SEC. 7. BUDGETARY EFFECTS.

    (a) PAYGO Scorecard.--The budgetary effects of this Act (and the 
amendments made by this Act) shall not be entered on either PAYGO 
scorecard maintained pursuant to section 4(d) of the Statutory Pay-As-
You-Go Act of 2010.
    (b) Senate PAYGO Scorecard.--The budgetary effects of this Act (and 
the amendments made by this Act) shall not be recorded on any PAYGO 
scorecard maintained for purposes of section 201 of S. Con. Res. 21 
(110th Congress).
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