[Congressional Record Volume 142, Number 119 (Wednesday, September 4, 1996)]
[House]
[Pages H9933-H9936]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               PROPANE EDUCATION AND RESEARCH ACT OF 1996

  Mr. SCHAEFER. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 1514) 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, as amended.
  The Clerk read as follows:

                               H.R. 1514

       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''.

[[Page H9934]]

     SEC. 2. FINDINGS.

       The Congress finds that--
       (1) propane gas, or liquefied petroleum gas, is an 
     essential energy commodity providing heat, hot water, cooking 
     fuel, and motor fuel among its many 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 the pollution in our 
     cities and towns; and
       (4) propane is primarily domestically produced and its use 
     provides energy security and jobs for Americans.

     SEC. 3. DEFINITIONS.

       For the purposes of this Act--
       (1) the term ``Council'' means a Propane Education and 
     Research Council created pursuant to section 4 of this Act;
       (2) the term ``industry'' means those persons involved in 
     the production, transportation, and sale of propane, and in 
     the manufacture and distribution of propane utilization 
     equipment, in the United States;
       (3) 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 the 
     propane industry;
       (4) the term ``odorized propane'' means propane which has 
     had odorant added to it;
       (5) the term ``producer'' means the owner of propane at the 
     time it is recovered at a gas processing plant or refinery;
       (6) the term ``propane'' means a hydrocarbon whose chemical 
     composition is predominantly C3H8, whether 
     recovered from natural gas or crude oil, and includes 
     liquefied petroleum gases and mixtures thereof;
       (7) 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) the term ``qualified industry organization'' means the 
     National Propane Gas Association, the Gas Processors 
     Association, a successor association of such associations, or 
     a group of retail marketers or producers who collectively 
     represent at least 25 percent of the volume of propane sold 
     or produced in the United States;
       (9) the term ``retail marketer'' means a person engaged 
     primarily in the sale of odorized propane to the ultimate 
     consumer or to retail propane dispensers;
       (10) the term ``retail propane dispenser'' means a person 
     who sells odorized propane to the ultimate consumer but is 
     not engaged primarily in the business of such sales; and
       (11) the term ``Secretary'' means the Secretary of Energy.

     SEC. 4. REFERENDA.

       (a) Creation of Program.--The qualified industry 
     organizations may conduct, at their own expense, a referendum 
     among producers and retail marketers for the creation of a 
     Propane Education and Research Council. The Council, if 
     established, shall reimburse the qualified industry 
     organizations for the cost of the referendum accounting and 
     documentation. Such referendum shall be conducted by an 
     independent auditing firm agreed to by the qualified industry 
     organizations. Voting rights in such referendum shall be 
     based on the volume of propane produced or odorized propane 
     sold in the previous calendar year or other representative 
     period. Upon approval of those persons representing two-
     thirds of the total volume of propane voted in the retail 
     marketer class and two-thirds of all propane voted in the 
     producer class, the Council shall be established, and shall 
     be authorized to levy an assessment on odorized propane in 
     accordance with section 6. All persons voting in the 
     referendum shall certify to the independent auditing firm the 
     volume of propane represented by their vote.
       (b) Termination.--On the Council's own initiative, or on 
     petition to the Council by producers and retail marketers 
     representing 35 percent of the volume of propane in each 
     class, the Council shall, at its own expense, hold a 
     referendum, to be conducted by an independent auditing firm 
     selected by the Council, to determine whether the industry 
     favors termination or suspension of the Council. Termination 
     or suspension shall not take effect unless it is approved by 
     persons representing more than one-half of the total volume 
     of odorized propane in the retail marketer class and more 
     than one-half of the total volume of propane in the producer 
     class, or is approved by persons representing more than two-
     thirds of the total volume of propane in either such class.

     SEC. 5. PROPANE EDUCATION AND RESEARCH COUNCIL.

       (a) Selection of Members.--The qualified industry 
     organizations shall select all retail marketer, public, and 
     producer members of the Council. 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 
     jointly select the public members. Vacancies in unfinished 
     terms of Council members shall be filled in the same 
     manner as were the 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) diverse geographic regions of the country.
       (c) Membership.--The Council shall consist of 21 members, 
     with 9 members representing retail marketers, 9 members 
     representing producers, and 3 public members. Other than the 
     public members, Council members shall be full-time employees 
     or owners of businesses in the industry or representatives of 
     agricultural cooperatives. 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. Only one person at a time from 
     any company or its affiliate may serve on the Council.
       (d) Compensation.--Council members shall receive no 
     compensation for their services, nor shall Council 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 Council meetings.
       (e) Terms.--Council 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 Council may be 
     returned to the Council if they have not been members for a 
     period of 2 years. Initial appointments to the Council shall 
     be for terms of 1, 2, and 3 years, staggered to provide for 
     the selection of 7 members each year.
       (f) Functions.--The Council shall develop programs and 
     projects and enter into contracts or agreements for 
     implementing this Act, including programs to enhance consumer 
     and employee safety and training, to provide for research and 
     development of clean and efficient propane utilization 
     equipment, to inform and educate the public about safety and 
     other issues associated with the use of propane, and to 
     provide for the payment of the costs thereof with funds 
     collected pursuant to this Act. The Council shall coordinate 
     its activities with industry trade association and others as 
     appropriate to provide efficient delivery of services and to 
     avoid unnecessary duplication of activities.
       (g) Use of Funds.--Not less than 5 percent of the funds 
     collected through assessments pursuant to this Act shall be 
     used for programs and projects intended to benefit the 
     agriculture industry in the United States. The Council shall 
     coordinate its activities in this regard with agriculture 
     industry trade associations and other organizations 
     representing the agriculture industry. The percentage of 
     funds collected through assessments pursuant to this Act to 
     be used 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 a motor 
     vehicle fuel, based on the historical average of such use 
     over the previous 3-year period.
       (h) Priorities.--Issues related to research and 
     development, safety, education, and training shall be given 
     priority by the Council in the development of its programs 
     and projects.
       (i) Administration.--The Council shall select from among 
     its members a Chairman and other officers as necessary, may 
     establish committees and subcommittees of the Council, and 
     shall adopt rules and bylaws for the conduct of business and 
     the implementation of this Act. The Council shall establish 
     procedures for the solicitation of industry comment and 
     recommendations on any significant plans, programs, and 
     projects to be funded by the Council. The Council may 
     establish advisory committees of persons other than Council 
     members.
       (j) Administrative Expenses.--(1) The administrative 
     expenses of operating the Council (not including costs 
     incurred in the collection of the assessment pursuant to 
     section 7) plus amounts paid under paragraph (2) shall not 
     exceed 10 percent of the funds collected in any fiscal year.
       (2) The Council shall annually reimburse the Secretary for 
     costs incurred by the Federal Government relating to the 
     Council, except that such reimbursement for any fiscal year 
     shall not exceed the amount that the Secretary determines is 
     the average annual salary of two employees of the Department 
     of Energy.
       (k) Budget.--Before August 1 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 such costs. Following this 
     review and comment, the Council shall submit the proposed 
     budget to the Secretary and to the Congress. The Secretary 
     may recommend programs and activities the Secretary considers 
     appropriate.
       (l) Records; Audits.--The Council shall keep minutes, 
     books, and records that clearly reflect all of the acts and 
     transactions of the Council and make public such information. 
     The books of the Council shall be audited by a certified 
     public accountant at least once each fiscal year and at such 
     other times as the Council may designate. Copies of such 
     audit shall be provided to all members of the Council, all 
     qualified industry organizations, and to other members of the 
     industry upon request. The Secretary shall receive notice of 
     meetings and may require reports on the activities of the 
     Council, as well as reports on compliance, violations, and 
     complaints regarding the implementation of this Act.
       (m) Public Access to Council Proceedings.--(1) All meetings 
     of the Council shall be open to the public after at least 30 
     days advance public notice.
       (2) The minutes of all meetings of the Council shall be 
     made available to and readily accessible by the public.
       (n) Annual Report.--Each year the Council shall prepare and 
     make publicly available a report which includes an 
     identification and description of all programs and projects 
     undertaken by the Council during the previous year as well as 
     those planned for the coming year.

[[Page H9935]]

     Such report shall also detail the allocation or planned 
     allocation of Council resources for each such program and 
     project.

     SEC. 6. ASSESSMENTS.

       (a) Amount.--The Council shall set the initial assessment 
     at no greater than one tenth of 1 cent per gallon of odorized 
     propane. Thereafter, annual assessments shall be sufficient 
     to cover the costs of the plans and programs developed by the 
     Council. The assessment shall not be greater than one-half 
     cent per gallon of odorized propane, unless approved by a 
     majority of those voting in a referendum in both the producer 
     and the retail marketer class. In no case may the assessment 
     be raised by more than one tenth of 1 cent per gallon of 
     odorized propane annually.
       (b) Ownership.--The owner of odorized propane at the time 
     of odorization, or the time of import of odorized propane, 
     shall make the assessment based on the volume of odorized 
     propane sold and placed into commerce. Assessments collected 
     are payable to the Council on a monthly basis by the 25th of 
     the month following the month of such collection. Propane 
     exported from the United States to another country is not 
     subject to the assessment.
       (c) Alternative Collection Rules.--The Council may 
     establish an alternative means of collecting the assessment 
     if another means is found to be more efficient and effective. 
     The Council may establish a late payment charge and rate of 
     interest to be imposed on any person who fails to remit or 
     pay to the Council any amount due under this Act.
       (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 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.
       (e) State Programs.--The Council shall establish a program 
     coordinating the operation of the Council with those of any 
     State propane education and research council created by State 
     law or regulation, or similar entity. Such coordination shall 
     include a joint or coordinated assessment collection process, 
     a reduced assessment, or an assessment rebate. A reduced 
     assessment or rebate shall be 20 percent of the regular 
     assessment collected in that State under this section. 
     Assessment rebates shall be paid only to--
       (1) 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
       (2) a similar entity, such as a foundation established by 
     the retail propane gas industry in that State, that meets 
     requirements established by the Council for specific programs 
     approved by the Council.

     SEC. 7. COMPLIANCE.

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

     SEC. 8. LOBBYING RESTRICTIONS.

       No funds collected by the Council shall be used in any 
     manner for influencing legislation or elections, except 
     that 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.--Beginning 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 of Energy, and 
     the public an analysis of changes in the price of propane 
     relative to other energy sources. 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 No. 2 fuel oil on an annual national 
     average basis. For purposes of indexing changes in consumer 
     grade propane, residential electricity, residential natural 
     gas, and end user No. 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.--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 No. 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. The Council shall inform the Secretary of Energy and 
     the Congress of any restriction of activities under this 
     subsection. Upon expiration of 180 days after the beginning 
     of any such restriction of activities, the Secretary of 
     Commerce shall again conduct the propane price analysis 
     described in subsection (a). Activities of the Council shall 
     continue to be restricted under this subsection until the 
     price index excess is 10.1 percent or less.

     SEC. 10. PRICING.

       In all cases, the price of propane shall be determined by 
     market forces. Consistent with the antitrust laws, the 
     Council may take no action, nor may any provision of this Act 
     be interpreted as establishing 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 may be construed to 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.

       Within 2 years after the date of enactment of this Act, and 
     at least once every 2 years thereafter, the Secretary of 
     Commerce shall prepare and submit to the 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. The Secretary of Commerce shall 
     consider and, to the extent practicable, shall include in the 
     report submissions by propane consumers, and shall consider 
     whether there have been long-term and short-term effects on 
     propane prices as a result of Council activities and Federal 
     programs, and whether there have been changes in the 
     proportion of propane demand attributable to various market 
     segments. To the extent that the report demonstrates that 
     there has been an adverse effect, the Secretary of Commerce 
     shall include recommendations for correcting the situation. 
     Upon petition by affected parties or upon 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.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Colorado [Mr. Schaefer] and the gentleman from New Jersey [Mr. Pallone] 
each will control 20 minutes.
  The Chair recognizes the gentleman from Colorado [Mr. Schaefer].
  (Mr. SCHAEFER asked and was given permission to revise and extend his 
remarks.)
  Mr. SCHAEFER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of H.R. 1514, the Propane Education 
and Research Act of 1995. This bill, introduced by Mr. Tauzin, allows 
the propane industry to establish a propane checkoff fee to fund 
propane research, development, education, and marketing activities. 
H.R. 1514, has broad support from the propane industry.
  Propane is an important fuel in our national energy mix. It is used 
to dry crops, heat homes, fuel vehicles, and as a feedstock for 
plastics and chemicals. Importantly, it is a clean fuel having 
emissions which are lower than many other fossil fuels.
  In summary, this bill would allow propane producers and retail 
marketers to conduct a referendum on the establishment of the Propane 
Education and Research Council. The council, made up of large and small 
propane producers and retail marketers from diverse geographic regions, 
would then be allowed to collect one-tenth of 1 cent on every gallon of 
propane sold. The amount assessed could ultimately rise to one-half of 
1 cent.
  The funds collected through this fee, approximately $8 million per 
year, are to be used to fund research, educational, safety, and 
marketing programs determined worthwhile by the council. Importantly, 
if the activities of the council cause the price of propane to rise 
disproportionately when compared to other similar fuels, certain 
activities of the council may be suspended.
  As I have noted several times before, this bill does not require the 
expenditure of significant amounts of Federal money. Through this bill, 
the propane industry is looking for ways to help itself, not a 
Government handout. I believe it is appropriate for industry, rather 
than the Government, to fund most of the research on commercial 
applications of new technologies which will benefit that industry.
  I appreciate the hard work Mr. Tauzin has done on this bill, and I 
look forward to working with him to keep this bill moving forward.
  Mr. Speaker, I reserve the balance of my time.
  Mr. PALLONE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I, too, rise in support of H.R. 1514, the Propane 
Education and Research Act.
  As Chairman Schaefer noted, this bill authorizes the propane industry 
to establish a propane checkoff fee to fund propane research, 
development, and education, including propane safety. Among other 
things, the bill establishes boundaries and obligations on the use of 
the collected funds and requires the Secretary of Commerce to report on 
propane prices and demand in the marketplace.
  I am a cosponsor of this bill. I believe that the authorization of 
privately

[[Page H9936]]

funded research into improving the safety of propane use is important 
to the public. I also endorse research into propane's potential 
benefits for the environment. We cannot afford to overlook any 
alternative in our energy mix, and this bill will help maximize the 
benefits of this fuel.
  I commend the bill's author, Mr. Tauzin, and the propane industry for 
working to move this bill forward. This legislation was unanimously 
reported by the Commerce Committee on June 27, and I believe it has at 
this time, some 230 cosponsors on both sides of the aisle, including 
many members of the Commerce Committee.
  I know of no objections to H.R. 1514 on this side of the aisle, and I 
would urge my colleagues to support it.
  Mr. Speaker, I reserve the balance of my time.

                              {time}  1245

  Mr. SCHAEFER. Mr. Speaker, I yield myself such time as I may consume.
  I would first of all thank the gentleman from New Jersey [Mr. 
Pallone] for his support on this very, very important legislation. 
Clean fuel I think is something that we have to look forward to in the 
future of this country, as well as alternative fuels. We certainly want 
to go on record as supporting that.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from Louisiana [Mr. Tauzin], the chief sponsor of the bill, who has 
been pushing this for a long time.
  Mr. TAUZIN. Mr. Speaker, let me first thank Chairman Schaefer for 
shepherding this bill to the House floor today and for all his 
extraordinary cooperation and support, and I particularly want to say 
the same thing for the gentleman from New Jersey, Mr. Pallone, the 
ranking minority member, who has been a sponsor and a very good friend 
for many years and a very strong supporter of this effort. I want to 
thank the gentleman for all his personal efforts in making this a 
bipartisan bill that has broad, in fact, bipartisan support from nearly 
231 cosponsors in the House, Democrats and Republicans coming together 
behind a bill that makes just good common sense.
  This bill has 34 cosponsors in the U.S. Senate, led by Senator 
Domenici. It has large support in this body. It is similar to the bill 
we offered in the last Congress. It was not acted upon before the 
Congress adjourned. We learned from last Congress' efforts and we have 
made improvements in this bill.
  Propane, as the Speaker knows, is an incredibly important fuel for 
many Americans--60 million Americans use propane. It is economical and 
it is environmentally sound. It is used by 7.7 million homes for 
cooking and hot water heating. It is used by one-half of all American 
farmers to dry crops, power tractors, and warm greenhouses, and it is 
used for recreational purposes by tens of millions of people for 
outdoor cooking, camping, and recreational vehicles.
  It is one of the very few fuels that does not receive Federal money 
in support of education, research, safety, and marketing efforts. And 
so this bill represents the best example of private funded research 
programs in America. It simply gives the propane industry, from the 
producers to the marketers and suppliers, an opportunity themselves to 
put together a research, education, safety, and marketing program for 
this critically important fuel for America.
  Again, it is a bill that has broad support not only in the industry 
but among so many Americans and so many Members of this House and the 
body on the other side. I want to thank the chairman of the committee 
for bringing it forward, and I particularly again want to single out 
the gentleman from New Jersey [Mr. Pallone] for his extraordinary 
efforts in cooperation, and urge adoption of the bill.


                             general leave

  Mr. SCHAEFER. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks on H.R. 1514.
  The SPEAKER pro tempore (Mr. Wicker). Is there objection to the 
request of the gentleman from Colorado?
  There was no objection.
  Mr. PALLONE. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. SCHAEFER. Mr. Speaker, I again thank both the gentleman from New 
Jersey [Mr. Pallone] and the gentleman from Louisiana [Mr. Tauzin] for 
working with us on this very, very important piece of legislation.
  Mr. Speaker, I have no further requests for time, and I yield back 
the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Colorado [Mr. Schaefer] that the House suspend the rules 
and pass the bill, H.R. 1514, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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