[Congressional Record (Bound Edition), Volume 150 (2004), Part 6]
[Senate]
[Pages 7668-7675]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 3048. Mr. McCAIN proposed an amendment to the bill S. 150, to make 
permanent the moratorium on taxes on Internet access and multiple and 
discriminatory taxes on electronic commerce imposed by the Internet 
Freedom Act; as follows:

       Strike out all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Internet Tax 
     Nondiscrimination Act''.

     SEC. 2. FOUR-YEAR EXTENSION OF INTERNET TAX MORATORIUM.

       (a) In General.--Subsection (a) of section 1101 of the 
     Internet Tax Freedom Act (47 U.S.C. 151 note) is amended to 
     read as follows:
       ``(a) Moratorium.--No State or political subdivision 
     thereof may impose any of the following taxes during the 
     period beginning November 1, 2003, and ending November 1, 
     2007:
       ``(1) Taxes on Internet access.
       ``(2) Multiple or discriminatory taxes on electronic 
     commerce.''.
       (b) Conforming Amendments.--
       (1) Section 1101 of the Internet Tax Freedom Act (47 U.S.C. 
     151 note) is amended by striking subsection (d) and 
     redesignating subsections (e) and (f) as subsections (d) and 
     (e), respectively.
       (2) Section 1104(10) of the Internet Tax Freedom Act (47 
     U.S.C. 151 note) is amended to read as follows:
       ``(10) Tax on internet access.--
       ``(A) In general.--The term `tax on Internet access' means 
     a tax on Internet access, regardless of whether such tax is 
     imposed on a provider of Internet access or a buyer of 
     Internet access and regardless of the terminology used to 
     describe the tax.
       ``(B) General exception.--The term `tax on Internet access' 
     does not include a tax levied upon or measured by net income, 
     capital stock, net worth, or property value.''.
       (3) Section 1104(2)(B)(i) of the Internet Tax Freedom Act 
     (47 U.S.C. 151 note) is amended by striking ``except with 
     respect to a tax (on Internet access) that was generally 
     imposed and actually enforced prior to October 1, 1998,''.
       (c) Internet Access Service; Internet Access.--
       (1) Internet access service.--Paragraph (3)(D) of section 
     1101(d) (as redesignated by subsection (b)(1) of this 
     section) of the Internet Tax Freedom Act (47 U.S.C. 151 note) 
     is amended by striking the second sentence and inserting 
     ``The term `Internet access service' does not include 
     telecommunications services, except to the extent such 
     services are purchased, used, or sold by a provider of 
     Internet access to provide Internet access.''.
       (2) Internet access.--Section 1104(5) of that Act is 
     amended by striking the second sentence and inserting ``The 
     term `Internet access' does not include telecommunications 
     services, except to the extent such services are purchased, 
     used, or sold by a provider of Internet access to provide 
     Internet access.''.

     SEC. 3. GRANDFATHERING OF STATES THAT TAX INTERNET ACCESS.

       The Internet Tax Freedom Act (47 U.S.C. 151 note) is 
     amended--
       (1) by redesignating section 1104 as section 1105; and
       (2) by inserting after section 1103 the following:

     ``SEC. 1104. GRANDFATHERING OF STATES THAT TAX INTERNET 
                   ACCESS.

       ``(a) Pre-October 1998 Taxes.--
       ``(1) In general.--Section 1101(a) does not apply to a tax 
     on Internet access that was generally imposed and actually 
     enforced prior to October 1, 1998, if, before that date, the 
     tax was authorized by statute and either--
       ``(A) a provider of Internet access services had a 
     reasonable opportunity to know, by virtue of a rule or other 
     public proclamation made by the appropriate administrative 
     agency of the State or political subdivision thereof, that 
     such agency has interpreted and applied such tax to Internet 
     access services; or
       ``(B) a State or political subdivision thereof generally 
     collected such tax on charges for Internet access.
       ``(2) Termination.--This subsection shall not apply after 
     November 1, 2006.
       ``(b) Pre-November 2003 Taxes.--
       ``(1) In general.--Section 1101(a) does not apply to a tax 
     on Internet access that was generally imposed and actually 
     enforced as of November 1, 2003, if, as of that date, the tax 
     was authorized by statute and--
       ``(A) a provider of Internet access services had a 
     reasonable opportunity to know by virtue of a public rule or 
     other public proclamation made by the appropriate 
     administrative agency of the State or political subdivision 
     thereof, that such agency has interpreted and applied such 
     tax to Internet access services; and
       ``(B) a State or political subdivision there-of generally 
     collected such tax on charges for Internet access.
       ``(2) Termination.--This subsection shall not apply after 
     November 1, 2005.''.

     SEC. 4. ACCOUNTING RULE.

       The Internet Tax Freedom Act (47 U.S.C. 151 note) is 
     amended by adding at the end the following:

     ``SEC. 1106. ACCOUNTING RULE.

       ``(a) In General.--If charges for Internet access are 
     aggregated with and not separately stated from charges for 
     telecommunications services or other charges that are subject 
     to taxation, then the charges for Internet access may be 
     subject to taxation unless the Internet access provider can 
     reasonably identify the charges for Internet access from its 
     books and records kept in the regular course of business.
       ``(b) Definitions.--In this section:
       ``(1) Charges for internet access.--The term `charges for 
     Internet access' means all charges for Internet access as 
     defined in section 1105(5).
       ``(2) Charges for telecommunications services.--The term 
     `charges for telecommunications services' means all charges 
     for telecommunications services, except to the extent such 
     services are purchased, used, or sold by a provider of 
     Internet access to provide Internet access.''.

     SEC. 5. EFFECT ON OTHER LAWS.

       The Internet Tax Freedom Act (47 U.S.C. 151 note), as 
     amended by section 4, is amended by adding at the end the 
     following:

     ``SEC. 1107. EFFECT ON OTHER LAWS.

       ``(a) Universal Service.--Nothing in this Act shall prevent 
     the imposition or collection of any fees or charges used to 
     preserve and advance Federal universal service or similar 
     State programs--
       ``(1) authorized by section 254 of the Communications Act 
     of 1934 (47 U.S.C. 254); or
       ``(2) in effect on February 8, 1996.
       ``(b) 911 and E-911 Services.--Nothing in this Act shall 
     prevent the imposition or collection, on a service used for 
     access to 911 or E-911 services, of any fee or charge 
     specifically designated or presented as dedicated by a State 
     or political subdivision thereof for the support of 911 or E-
     911 services if no portion of the revenue derived from such 
     fee or charge is obligated or expended for any purpose other 
     than support of 911 or E-911 services.
       ``(c) Non-Tax Regulatory Proceedings.--Nothing in this Act 
     shall be construed to affect any Federal or State regulatory 
     proceeding that is not related to taxation.''.

     SEC. 6. EXCEPTION FOR VOICE AND OTHER SERVICES OVER THE 
                   INTERNET.

       The Internet Tax Freedom Act (47 U.S.C. 151 note), as 
     amended by section 5, is amended by adding at the end the 
     following:

     ``SEC. 1108. EXCEPTION FOR VOICE AND OTHER SERVICES OVER THE 
                   INTERNET.

       ``Nothing in this Act shall be construed to affect the 
     imposition of tax on a charge for voice or any other service 
     utilizing Internet Protocol or any successor protocol. This 
     section shall not apply to Internet access or to any services 
     that are incidental to Internet access, such as e-mail, text 
     instant messaging, and instant messaging with voice 
     capability.''.

     SEC. 7. EFFECTIVE DATE.

       The amendments made by this Act take effect on November 1, 
     2003.
                                 ______
                                 
  SA 3049. Mrs. HUTCHISON proposed an amendment to amendment SA 3048 
proposed by Mr. McCain to the bill S. 150, to make permanent the 
moratorium on taxes on Internet access and multiple and discriminatory 
taxes on electronic commerce imposed by the Internet Tax Freedom Act; 
as follows:

       At the appropriate place, insert the following:

     SEC. __. CHANGE IN DEFINITION OF INTERNET ACCESS SERVICE.

       Paragraph (10) of section 1105 of the Internet Tax Freedom 
     Act, as redesignated by this Act, is amended--
       (1) by striking ``The term'' and inserting the following:
       ``(A) In general.--The term''; and
       (2) by adding at the end the following:
       ``(B) General exception.--The term does not--
       ``(i) include a tax levied upon or measured by net income, 
     capital stock, net worth, or property value; or
       ``(ii) apply to any payment made for use of the public 
     right-of-way or made in lieu of a fee for use of the public 
     right-of-way, however it may be denominated, including but 
     not limited to an access line fee, franchise fee, license 
     fee, or gross receipts or gross revenue fee.''.
                                 ______
                                 
  SA 3050. Mr. DASCHLE (for himself, Mr. Durbin, and Mr. Johnson) 
proposed an amendment to the bill S. 150, to make permanent the 
moratorium on taxes on Internet access and multiple and discriminatory 
taxes on electronic commerce imposed by the Internet Tax Freedom Act; 
as follows:

       At the end, add the following:

                             TITLE__--FUELS

       Subtitle A--General Provisions Relating to Renewable Fuels

     SEC. __01. RENEWABLE CONTENT OF GASOLINE.

       (a) In General.--Section 211 of the Clean Air Act (42 
     U.S.C. 7545) is amended--

[[Page 7669]]

       (1) by redesignating subsection (o) as subsection (r); and
       (2) by inserting after subsection (n) the following:
       ``(o) Renewable Fuel Program.--
       ``(1) Definitions.--In this section:
       ``(A) Cellulosic biomass ethanol.--The term `cellulosic 
     biomass ethanol' means ethanol derived from any 
     lignocellulosic or hemicellulosic matter that is available on 
     a renewable or recurring basis, including--
       ``(i) dedicated energy crops and trees;
       ``(ii) wood and wood residues;
       ``(iii) plants;
       ``(iv) grasses;
       ``(v) agricultural residues;
       ``(vi) fibers;
       ``(vii) animal wastes and other waste materials; and
       ``(viii) municipal solid waste.
       ``(B) Renewable fuel.--
       ``(i) In general.--The term `renewable fuel' means motor 
     vehicle fuel that--

       ``(I)(aa) is produced from grain, starch, oilseeds, or 
     other biomass; or
       ``(bb) is natural gas produced from a biogas source, 
     including a landfill, sewage waste treatment plant, feedlot, 
     or other place where decaying organic material is found; and
       ``(II) is used to replace or reduce the quantity of fossil 
     fuel present in a fuel mixture used to operate a motor 
     vehicle.

       ``(ii) Inclusion.--The term `renewable fuel' includes--

       ``(I) cellulosic biomass ethanol; and
       ``(II) biodiesel (as defined in section 312(f) of the 
     Energy Policy Act of 1992 (42 U.S.C. 13220(f))).

       ``(C) Small refinery.--The term `small refinery' means a 
     refinery for which the average aggregate daily crude oil 
     throughput for a calendar year (as determined by dividing the 
     aggregate throughput for the calendar year by the number of 
     days in the calendar year) does not exceed 75,000 barrels.
       ``(2) Renewable fuel program.--
       ``(A) Regulations.--
       ``(i) In general.--Not later than 1 year after the date of 
     enactment of this paragraph, the Administrator shall 
     promulgate regulations to ensure that gasoline sold or 
     introduced into commerce in the United States (except in 
     Alaska and Hawaii), on an annual average basis, contains the 
     applicable volume of renewable fuel determined in accordance 
     with subparagraph (B).
       ``(ii) Provisions of regulations.--Regardless of the date 
     of promulgation, the regulations promulgated under clause 
     (i)--

       ``(I) shall contain compliance provisions applicable to 
     refiners, blenders, distributors, and importers, as 
     appropriate, to ensure that the requirements of this 
     paragraph are met; but
       ``(II) shall not--

       ``(aa) restrict cases in geographic areas in which 
     renewable fuel may be used; or
       ``(bb) impose any per-gallon obligation for the use of 
     renewable fuel.
       ``(iii) Requirement in case of failure to promulgate 
     regulations.--If the Administrator does not promulgate 
     regulations under clause (i), the percentage of renewable 
     fuel in gasoline sold or dispensed to consumers in the United 
     States, on a volume basis, shall be 1.8 percent for calendar 
     year 2005.
       ``(B) Applicable volume.--
       ``(i) Calendar years 2005 through 2012.--For the purpose of 
     subparagraph (A), the applicable volume for any of calendar 
     years 2005 through 2012 shall be determined in accordance 
     with the following table:

                                                   Applicable volume of
``Calendar year:                                         renewable fuel
                                              (in billions of gallons):
  2005.........................................................3.1 ....

  2006.........................................................3.3 ....

  2007.........................................................3.5 ....

  2008.........................................................3.8 ....

  2009.........................................................4.1 ....

  2010.........................................................4.4 ....

  2011.........................................................4.7 ....

  2012.........................................................5.0.....

       ``(ii) Calendar year 2013 and thereafter.--For the purpose 
     of subparagraph (A), the applicable volume for calendar year 
     2013 and each calendar year thereafter shall be equal to the 
     product obtained by multiplying--

       ``(I) the number of gallons of gasoline that the 
     Administrator estimates will be sold or introduced into 
     commerce in the calendar year; and
       ``(II) the ratio that--

       ``(aa) 5,000,000,000 gallons of renewable fuel; bears to
       ``(bb) the number of gallons of gasoline sold or introduced 
     into commerce in calendar year 2012.
       ``(3) Applicable percentages.--
       ``(A) Provision of estimate of volumes of gasoline sales.--
     Not later than October 31 of each of calendar years 2004 
     through 2011, the Administrator of the Energy Information 
     Administration shall provide to the Administrator of the 
     Environmental Protection Agency an estimate of the volumes of 
     gasoline sold or introduced into commerce in the United 
     States during the following calendar year.
       ``(B) Determination of applicable percentages.--
       ``(i) In general.--Not later than November 30 of each of 
     calendar years 2005 through 2012, based on the estimate 
     provided under subparagraph (A), the Administrator of the 
     Environmental Protection Agency shall determine and publish 
     in the Federal Register, with respect to the following 
     calendar year, the renewable fuel obligation that ensures 
     that the requirements of paragraph (2) are met.
       ``(ii) Required elements.--The renewable fuel obligation 
     determined for a calendar year under clause (i) shall--

       ``(I) be applicable to refiners, blenders, and importers, 
     as appropriate;
       ``(II) be expressed in terms of a volume percentage of 
     gasoline sold or introduced into commerce; and
       ``(III) subject to subparagraph (C)(i), consist of a single 
     applicable percentage that applies to all categories of 
     persons specified in subclause (I).

       ``(C) Adjustments.--In determining the applicable 
     percentage for a calendar year, the Administrator shall make 
     adjustments--
       ``(i) to prevent the imposition of redundant obligations on 
     any person specified in subparagraph (B)(ii)(I); and
       ``(ii) to account for the use of renewable fuel during the 
     previous calendar year by small refineries that are exempt 
     under paragraph (9).
       ``(4) Cellulosic biomass ethanol.--For the purpose of 
     paragraph (2), 1 gallon of cellulosic biomass ethanol--
       ``(A) shall be considered to be the equivalent of 1.5 
     gallons of renewable fuel; or
       ``(B) if the cellulosic biomass is derived from 
     agricultural residue, shall be considered to be the 
     equivalent of 2.5 gallons of renewable fuel.
       ``(5) Credit program.--
       ``(A) In general.--The regulations promulgated under 
     paragraph (2)(A) shall provide--
       ``(i) for the generation of an appropriate amount of 
     credits by any person that refines, blends, or imports 
     gasoline that contains a quantity of renewable fuel that is 
     greater than the quantity required under paragraph (2);
       ``(ii) for the generation of an appropriate amount of 
     credits for biodiesel; and
       ``(iii) for the generation of credits by small refineries 
     in accordance with paragraph (9)(C).
       ``(B) Use of credits.--A person that generates credits 
     under subparagraph (A) may use the credits, or transfer all 
     or a portion of the credits to another person, for the 
     purpose of complying with paragraph (2).
       ``(C) Duration of credits.--A credit generated under this 
     paragraph shall be valid to show compliance--
       ``(i) subject to clause (ii), for the calendar year in 
     which the credit was generated or the following calendar 
     year; or
       ``(ii) if the Administrator promulgates regulations under 
     paragraph (6), for the calendar year in which the credit was 
     generated or any of the following 2 calendar years.
       ``(D) Inability to generate or purchase sufficient 
     credits.--The regulations promulgated under paragraph (2)(A) 
     shall include provisions allowing any person that is unable 
     to generate or purchase sufficient credits to meet the 
     requirements of paragraph (2) to carry forward a renewable 
     fuel deficit on condition that the person, in the calendar 
     year following the year in which the renewable fuel deficit 
     is created--
       ``(i) achieves compliance with the renewable fuel 
     requirement under paragraph (2); and
       ``(ii) generates or purchases additional renewable fuel 
     credits to offset the renewable fuel deficit of the previous 
     year.
       ``(6) Seasonal variations in renewable fuel use.--
       ``(A) Study.--For each of calendar years 2005 through 2012, 
     the Administrator of the Energy Information Administration 
     shall conduct a study of renewable fuel blending to determine 
     whether there are excessive seasonal variations in the use of 
     renewable fuel.
       ``(B) Regulation of excessive seasonal variations.--If, for 
     any calendar year, the Administrator of the Energy 
     Information Administration, based on the study under 
     subparagraph (A), makes the determinations specified in 
     subparagraph (C), the Administrator of the Environmental 
     Protection Agency shall promulgate regulations to ensure that 
     35 percent or more of the quantity of renewable fuel 
     necessary to meet the requirements of paragraph (2) is used 
     during each of the 2 periods specified in subparagraph (D) of 
     each subsequent calendar year.
       ``(C) Determinations.--The determinations referred to in 
     subparagraph (B) are that--
       ``(i) less than 35 percent of the quantity of renewable 
     fuel necessary to meet the requirements of paragraph (2) has 
     been used during 1 of the 2 periods specified in subparagraph 
     (D) of the calendar year; and
       ``(ii) a pattern of excessive seasonal variation described 
     in clause (i) will continue in subsequent calendar years.
       ``(D) Periods.--The 2 periods referred to in this paragraph 
     are--
       ``(i) April through September; and
       ``(ii) January through March and October through December.
       ``(E) Exclusion.--Renewable fuel blended or consumed in 
     calendar year 2005 in a State that has received a waiver 
     under section 209(b) shall not be included in the study under 
     subparagraph (A).

[[Page 7670]]

       ``(7) Waivers.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Agriculture and the Secretary of Energy, may 
     waive the requirements of paragraph (2) in whole or in part 
     on petition by 1 or more States by reducing the national 
     quantity of renewable fuel required under paragraph (2)--
       ``(i) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that 
     implementation of the requirement would severely harm the 
     economy or environment of a State, a region, or the United 
     States; or
       ``(ii) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that there is an 
     inadequate domestic supply or distribution capacity to meet 
     the requirement.
       ``(B) Petitions for waivers.--The Administrator, in 
     consultation with the Secretary of Agriculture and the 
     Secretary of Energy, shall approve or disapprove a State 
     petition for a waiver of the requirements of paragraph (2) 
     within 90 days after the date on which the petition is 
     received by the Administrator.
       ``(C) Termination of waivers.--A waiver granted under 
     subparagraph (A) shall terminate after 1 year, but may be 
     renewed by the Administrator after consultation with the 
     Secretary of Agriculture and the Secretary of Energy.
       ``(8) Study and waiver for initial year of program.--
       ``(A) In general.--Not later than 180 days after the date 
     of enactment of this paragraph, the Secretary of Energy shall 
     conduct for the Administrator a study assessing whether the 
     renewable fuel requirement under paragraph (2) will likely 
     result in significant adverse impacts on consumers in 2005, 
     on a national, regional, or State basis.
       ``(B) Required evaluations.--The study shall evaluate 
     renewable fuel--
       ``(i) supplies and prices;
       ``(ii) blendstock supplies; and
       ``(iii) supply and distribution system capabilities.
       ``(C) Recommendations by the secretary.--Based on the 
     results of the study, the Secretary of Energy shall make 
     specific recommendations to the Administrator concerning 
     waiver of the requirements of paragraph (2), in whole or in 
     part, to prevent any adverse impacts described in 
     subparagraph (A).
       ``(D) Waiver.--
       ``(i) In general.--Not later than 270 days after the date 
     of enactment of this paragraph, the Administrator shall, if 
     and to the extent recommended by the Secretary of Energy 
     under subparagraph (C), waive, in whole or in part, the 
     renewable fuel requirement under paragraph (2) by reducing 
     the national quantity of renewable fuel required under 
     paragraph (2) in calendar 2005.
       ``(ii) No effect on waiver authority.--Clause (i) does not 
     limit the authority of the Administrator to waive the 
     requirements of paragraph (2) in whole, or in part, under 
     paragraph (7).
       ``(9) Assessment and waiver.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Energy and the Secretary of Agriculture, 
     shall evaluate the requirement of paragraph (2) and 
     determine, before January 1, 2007, and before January 1 of 
     any subsequent year in which the applicable volume of 
     renewable fuel is increased under paragraph (2)(B), whether 
     the requirement of paragraph (2), including the applicable 
     volume of renewable fuel contained in paragraph (2)(B) should 
     remain in effect, in whole or in part, during 2007 or any 
     subsequent year.
       ``(B) Considerations.--In evaluating the requirement of 
     paragraph (2) and in making any determination under this 
     paragraph, the Administrator shall consider the best 
     available information and data collected by accepted methods 
     or best available means regarding--
       ``(i) the capacity of renewable fuel producers to supply an 
     adequate amount of renewable fuel at competitive prices to 
     fulfill the requirement of paragraph (2);
       ``(ii) the potential of the requirement of paragraph (2) to 
     raise significantly the price of gasoline, food (excluding 
     the net price impact on the requirement in paragraph (2) on 
     commodities used in the production of ethanol), or heating 
     oil for consumers in any significant region of the country 
     above the price that would otherwise apply to those 
     commodities in the absence of the requirement;
       ``(iii) the potential of the requirement of paragraph (2) 
     to interfere with the supply of fuel in any significant 
     gasoline market or region of the country, including 
     interference with the efficient operation of refiners, 
     blenders, importers, wholesale suppliers, and retail vendors 
     of gasoline and other motor fuels; and
       ``(iv) the potential of the requirement of paragraph (2) to 
     cause or promote exceedances of Federal, State, or local air 
     quality standards.
       ``(C) Waiver.--If the Administrator determines, by clear 
     and convincing information, after public notice and 
     opportunity for comment, that the requirement of paragraph 
     (2) would have significant and meaningful adverse impact on 
     the supply of fuel and related infrastructure or on the 
     economy, public health, or environment of any significant 
     area or region of the country, the Administrator may waive, 
     in whole or in part, the requirement of paragraph (2) in any 
     1 year for which the determination is made for that area or 
     region of the country, except that any such waiver shall not 
     have the effect of reducing the applicable volume of 
     renewable fuel specified in paragraph (2)(B) with respect to 
     any year for which the determination is made.
       ``(D) Economic impact.--In determining economic impact 
     under this paragraph, the Administrator shall not consider 
     the reduced revenues available from the Highway Trust Fund as 
     a result of the use of ethanol.
       ``(10) Small refineries.--
       ``(A) Temporary exemption.--
       ``(i) In general.--The requirements of paragraph (2) shall 
     not apply to small refineries until calendar year 2011.
       ``(ii) Extension of exemption.--

       ``(I) Study by secretary of energy.--Not later than 
     December 31, 2007, the Secretary of Energy shall conduct for 
     the Administrator a study to determine whether compliance 
     with the requirements of paragraph (2) would impose a 
     disproportionate economic hardship on small refineries.
       ``(II) Extension of exemption.--In the case of a small 
     refinery that the Secretary of Energy determines under 
     subclause (I) would be subject to a disproportionate economic 
     hardship if required to comply with paragraph (2), the 
     Administrator shall extend the exemption under clause (i) for 
     the small refinery for a period of not less than 2 additional 
     years.

       ``(B) Petitions based on disproportionate economic 
     hardship.--
       ``(i) Extension of exemption.--A small refinery may at any 
     time petition the Administrator for an extension of the 
     exemption under subparagraph (A) for the reason of 
     disproportionate economic hardship.
       ``(ii) Evaluation of petitions.--In evaluating a petition 
     under clause (i), the Administrator, in consultation with the 
     Secretary of Energy, shall consider the findings of the study 
     under subparagraph (A)(ii) and other economic factors.
       ``(iii) Deadline for action on petitions.--The 
     Administrator shall act on any petition submitted by a small 
     refinery for a hardship exemption not later than 90 days 
     after the date of receipt of the petition.
       ``(C) Credit program.--If a small refinery notifies the 
     Administrator that the small refinery waives the exemption 
     under subparagraph (A), the regulations promulgated under 
     paragraph (2)(A) shall provide for the generation of credits 
     by the small refinery under paragraph (5) beginning in the 
     calendar year following the date of notification.
       ``(D) Opt-in for small refineries.--A small refinery shall 
     be subject to the requirements of paragraph (2) if the small 
     refinery notifies the Administrator that the small refinery 
     waives the exemption under subparagraph (A).
       ``(11) Ethanol market concentration analysis.--
       ``(A) Analysis.--
       ``(i) In general.--Not later than 180 days after the date 
     of enactment of this paragraph, and annually thereafter, the 
     Federal Trade Commission shall perform a market concentration 
     analysis of the ethanol production industry using the 
     Herfindahl-Hirschman Index to determine whether there is 
     sufficient competition among industry participants to avoid 
     price-setting and other anticompetitive behavior.
       ``(ii) Scoring.--For the purpose of scoring under clause 
     (i) using the Herfindahl-Hirschman Index, all marketing 
     arrangements among industry participants shall be considered.
       ``(B) Report.--Not later than December 1, 2004, and 
     annually thereafter, the Federal Trade Commission shall 
     submit to Congress and the Administrator a report on the 
     results of the market concentration analysis performed under 
     subparagraph (A)(i).''.
       (b) Penalties and Enforcement.--Section 211(d) of the Clean 
     Air Act (42 U.S.C. 7545(d)) is amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by striking ``or (n)'' each 
     place it appears and inserting ``(n), or (o)''; and
       (B) in the second sentence, by striking ``or (m)'' and 
     inserting ``(m), or (o)''; and
       (2) in the first sentence of paragraph (2), by striking 
     ``and (n)'' each place it appears and inserting ``(n), and 
     (o)''.
       (c) Exclusion From Ethanol Waiver.--Section 211(h) of the 
     Clean Air Act (42 U.S.C. 7545(h)) is amended--
       (1) by redesignating paragraph (5) as paragraph (6); and
       (2) by inserting after paragraph (4) the following:
     ``(5) Exclusion from ethanol waiver.--
       ``(A) Promulgation of regulations.--Upon notification, 
     accompanied by supporting documentation, from the Governor of 
     a State that the Reid vapor pressure limitation established 
     by paragraph (4) will increase emissions that contribute to 
     air pollution in any area in the State, the Administrator 
     shall, by regulation, apply, in lieu of the Reid vapor 
     pressure limitation established by paragraph (4), the Reid 
     vapor pressure limitation established by paragraph (1) to all 
     fuel blends containing gasoline and 10

[[Page 7671]]

     percent denatured anhydrous ethanol that are sold, offered 
     for sale, dispensed, supplied, offered for supply, 
     transported, or introduced into commerce in the area during 
     the high ozone season.
       ``(B) Deadline for promulgation.--The Administrator shall 
     promulgate regulations under subparagraph (A) not later than 
     90 days after the date of receipt of a notification from a 
     Governor under that subparagraph.
       ``(C) Effective date.--
       ``(i) In general.--With respect to an area in a State for 
     which the Governor submits a notification under subparagraph 
     (A), the regulations under that subparagraph shall take 
     effect on the later of--

       ``(I) the first day of the first high ozone season for the 
     area that begins after the date of receipt of the 
     notification; or
       ``(II) 1 year after the date of receipt of the 
     notification.

       ``(ii) Extension of effective date based on determination 
     of insufficient supply.--

       ``(I) In general.--If, after receipt of a notification with 
     respect to an area from a Governor of a State under 
     subparagraph (A), the Administrator determines, on the 
     Administrator's own motion or on petition of any person and 
     after consultation with the Secretary of Energy, that the 
     promulgation of regulations described in subparagraph (A) 
     would result in an insufficient supply of gasoline in the 
     State, the Administrator, by regulation--

       ``(aa) shall extend the effective date of the regulations 
     under clause (i) with respect to the area for not more than 1 
     year; and
       ``(bb) may renew the extension under item (aa) for 2 
     additional periods, each of which shall not exceed 1 year.

       ``(II) Deadline for action on petitions.--The Administrator 
     shall act on any petition submitted under subclause (I) not 
     later than 180 days after the date of receipt of the 
     petition.''.

     SEC. __02. RENEWABLE FUEL.

       (a) In General.--The Clean Air Act is amended by inserting 
     after section 211 (42 U.S.C. 7411) the following:

     ``SEC. 212. RENEWABLE FUEL.

       ``(a) Definitions.--In this section:
       ``(1) Municipal solid waste.--The term `municipal solid 
     waste' has the meaning given the term `solid waste' in 
     section 1004 of the Solid Waste Disposal Act (42 U.S.C. 
     6903).
       ``(2) RFG state.--The term `RFG State' means a State in 
     which is located 1 or more covered areas (as defined in 
     section 211(k)(10)(D)).
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Energy.
       ``(b) Survey of Renewable Fuel Market.--
       ``(1) Survey and report.--Not later than December 1, 2006, 
     and annually thereafter, the Administrator shall--
       ``(A) conduct, with respect to each conventional gasoline 
     use area and each reformulated gasoline use area in each 
     State, a survey to determine the market shares of--
       ``(i) conventional gasoline containing ethanol;
       ``(ii) reformulated gasoline containing ethanol;
       ``(iii) conventional gasoline containing renewable fuel; 
     and
       ``(iv) reformulated gasoline containing renewable fuel; and
       ``(B) submit to Congress, and make publicly available, a 
     report on the results of the survey under subparagraph (A).
       ``(2) Recordkeeping and reporting requirements.--
       ``(A) In general.--The Administrator may require any 
     refiner, blender, or importer to keep such records and make 
     such reports as are necessary to ensure that the survey 
     conducted under paragraph (1) is accurate.
       ``(B) Reliance on existing requirements.--To avoid 
     duplicative requirements, in carrying out subparagraph (A), 
     the Administrator shall rely, to the maximum extent 
     practicable, on reporting and recordkeeping requirements in 
     effect on the date of enactment of this section.
       ``(3) Confidentiality.--Activities carried out under this 
     subsection shall be conducted in a manner designed to protect 
     confidentiality of individual responses.
       ``(c) Commercial Byproducts From Municipal Solid Waste Loan 
     Guarantee Program.--
       ``(1) Establishment of program.--The Secretary shall 
     establish a program to provide guarantees of loans by private 
     institutions for the construction of facilities for the 
     processing and conversion of municipal solid waste into fuel 
     ethanol and other commercial byproducts.
       ``(2) Requirements.--The Secretary may provide a loan 
     guarantee under paragraph (1) to an applicant if--
       ``(A) without a loan guarantee, credit is not available to 
     the applicant under reasonable terms or conditions sufficient 
     to finance the construction of a facility described in 
     paragraph (1);
       ``(B) the prospective earning power of the applicant and 
     the character and value of the security pledged provide a 
     reasonable assurance of repayment of the loan to be 
     guaranteed in accordance with the terms of the loan; and
       ``(C) the loan bears interest at a rate determined by the 
     Secretary to be reasonable, taking into account the current 
     average yield on outstanding obligations of the United States 
     with remaining periods of maturity comparable to the maturity 
     of the loan.
       ``(4) Criteria.--In selecting recipients of loan guarantees 
     from among applicants, the Secretary shall give preference to 
     proposals that--
       ``(A) meet all applicable Federal and State permitting 
     requirements;
       ``(B) are most likely to be successful; and
       ``(C) are located in local markets that have the greatest 
     need for the facility because of--
       ``(i) the limited availability of land for waste disposal; 
     or
       ``(ii) a high level of demand for fuel ethanol or other 
     commercial byproducts of the facility.
       ``(5) Maturity.--A loan guaranteed under paragraph (1) 
     shall have a maturity of not more than 20 years.
       ``(6) Terms and conditions.--The loan agreement for a loan 
     guaranteed under paragraph (1) shall provide that no 
     provision of the loan agreement may be amended or waived 
     without the consent of the Secretary.
       ``(7) Assurance of repayment.--The Secretary shall require 
     that an applicant for a loan guarantee under paragraph (1) 
     provide an assurance of repayment in the form of a 
     performance bond, insurance, collateral, or other means 
     acceptable to the Secretary in an amount equal to not less 
     than 20 percent of the amount of the loan.
       ``(8) Guarantee fee.--The recipient of a loan guarantee 
     under paragraph (1) shall pay the Secretary an amount 
     determined by the Secretary to be sufficient to cover the 
     administrative costs of the Secretary relating to the loan 
     guarantee.
       ``(9) Full faith and credit.--
       ``(A) In general.--The full faith and credit the United 
     States is pledged to the payment of all guarantees made under 
     this subsection.
       ``(B) Conclusive evidence.--Any guarantee made by the 
     Secretary under this subsection shall be conclusive evidence 
     of the eligibility of the loan for the guarantee with respect 
     to principal and interest.
       ``(C) Validity.--The validity of the guarantee shall be 
     incontestable in the hands of a holder of the guaranteed 
     loan.
       ``(10) Reports.--Until each guaranteed loan under this 
     subsection has been repaid in full, the Secretary shall 
     annually submit to Congress a report on the activities of the 
     Secretary under this subsection.
       ``(11) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this subsection.
       ``(12) Termination of authority.--The authority of the 
     Secretary to issue a new loan guarantee under paragraph (1) 
     terminates on the date that is 10 years after the date of 
     enactment of this section.
       ``(d) Authorization of Appropriations for Resource 
     Center.--There is authorized to be appropriated, for a 
     resource center to further develop bioconversion technology 
     using low-cost biomass for the production of ethanol at the 
     Center for Biomass-Based Energy at the University of 
     Mississippi and the University of Oklahoma, $4,000,000 for 
     each of fiscal years 2004 through 2006.
       ``(e) Renewable Fuel Production Research and Development 
     Grants.--
       ``(1) In general.--The Administrator shall provide grants 
     for the research into, and development and implementation of, 
     renewable fuel production technologies in RFG States with low 
     rates of ethanol production, including low rates of 
     production of cellulosic biomass ethanol.
       ``(2) Eligibility.--
       ``(A) In general.--The entities eligible to receive a grant 
     under this subsection are academic institutions in RFG 
     States, and consortia made up of combinations of academic 
     institutions, industry, State government agencies, or local 
     government agencies in RFG States, that have proven 
     experience and capabilities with relevant technologies.
       ``(B) Application.--To be eligible to receive a grant under 
     this subsection, an eligible entity shall submit to the 
     Administrator an application in such manner and form, and 
     accompanied by such information, as the Administrator may 
     specify.
       ``(4) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $25,000,000 
     for each of fiscal years 2004 through 2008.
       ``(f) Cellulosic Biomass Ethanol Conversion Assistance--
       ``(1) In general.--The Secretary may provide grants to 
     merchant producers of cellulosic biomass ethanol in the 
     United States to assist the producers in building eligible 
     production facilities described in paragraph (2) for the 
     production of cellulosic biomass ethanol.
       ``(2) Eligible production facilities.--A production 
     facility shall be eligible to receive a grant under this 
     subsection if the production facility--
       ``(A) is located in the United States; and
       ``(B) uses cellulosic biomass feedstocks derived from 
     agricultural residues or municipal solid waste.
       ``(3) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection--
       ``(A) $100,000,000 for fiscal year 2004;

[[Page 7672]]

       ``(B) $250,000,000 for fiscal year 2005; and
       ``(C) $400,000000 for fiscal year 2006.''.
       (b) Conforming Amendment.--The table of contents for the 
     Clean Air Act (42 U.S.C. 7401 prec.) is amended by inserting 
     after the item relating to section 211 the following:

``212. Renewable fuels.''.

     SEC. __03. SURVEY OF RENEWABLE FUELS CONSUMPTION.

       Section 205 of the Department of Energy Organization Act 
     (42 U.S.C. 7135) is amended by adding at the end the 
     following:
       ``(m) Survey of Renewable Fuels Consumption.--
       ``(1) In general.--In order to improve the ability to 
     evaluate the effectiveness of the Nation's renewable fuels 
     mandate, the Administrator shall conduct and publish the 
     results of a survey of renewable fuels consumption in the 
     motor vehicle fuels market in the United States monthly, and 
     in a manner designed to protect the confidentiality of 
     individual responses.
       ``(2) Elements of survey.--In conducting the survey, the 
     Administrator shall collect information retrospectively to 
     1998, on a national basis and a regional basis, including--
       ``(A) the quantity of renewable fuels produced;
       ``(B) the cost of production;
       ``(C) the cost of blending and marketing;
       ``(D) the quantity of renewable fuels blended;
       ``(E) the quantity of renewable fuels imported; and
       ``(F) market price data.''.

                 Subtitle B--Federal Reformulated Fuels

     SEC. __11. SHORT TITLE.

       This subtitle may be cited as the ``Federal Reformulated 
     Fuels Act of 2004''.

     SEC. __12. LEAKING UNDERGROUND STORAGE TANKS.

       (a) Use of LUST Funds for Remediation of Contamination From 
     Ether Fuel Additives.--Section 9003(h) of the Solid Waste 
     Disposal Act (42 U.S.C. 6991b(h)) is amended--
       (1) in paragraph (7)(A)--
       (A) by striking ``paragraphs (1) and (2) of this 
     subsection'' and inserting ``paragraphs (1), (2), and (12)''; 
     and
       (B) by inserting ``and section 9010'' before ``if''; and
       (2) by adding at the end the following:
       ``(12) Remediation of contamination from ether fuel 
     additives.--
       ``(A) In general.--The Administrator and the States may use 
     funds made available under section 9013(1) to carry out 
     corrective actions with respect to a release of methyl 
     tertiary butyl ether or other ether fuel additive that 
     presents a threat to human health, welfare, or the 
     environment.
       ``(B) Applicable authority.--Subparagraph (A) shall be 
     carried out--
       ``(i) in accordance with paragraph (2), except that a 
     release with respect to which a corrective action is carried 
     out under subparagraph (A) shall not be required to be from 
     an underground storage tank; and
       ``(ii) in the case of a State, in accordance with a 
     cooperative agreement entered into by the Administrator and 
     the State under paragraph (7).''.
       (b) Release Prevention and Compliance.--Subtitle I of the 
     Solid Waste Disposal Act (42 U.S.C. 6991 et seq.) is amended 
     by striking section 9010 and inserting the following:

     ``SEC. 9010. RELEASE PREVENTION AND COMPLIANCE.

       ``Funds made available under section 9013(2) from the 
     Leaking Underground Storage Tank Trust Fund may be used for 
     conducting inspections, or for issuing orders or bringing 
     actions under this subtitle--
       ``(1) by a State (pursuant to section 9003(h)(7)) acting 
     under--
       ``(A) a program approved under section 9004; or
       ``(B) State requirements regulating underground storage 
     tanks that are similar or identical to this subtitle, as 
     determined by the Administrator; and
       ``(2) by the Administrator, acting under this subtitle or a 
     State program approved under section 9004.

     ``SEC. 9011. AUTHORIZATION OF APPROPRIATIONS.

       ``In addition to amounts made available under section 
     2007(f), there are authorized to be appropriated from the 
     Leaking Underground Storage Tank Trust Fund, notwithstanding 
     section 9508(c)(1) of the Internal Revenue Code of 1986--
       ``(1) to carry out section 9003(h)(12), $200,000,000 for 
     fiscal year 2003, to remain available until expended; and
       ``(2) to carry out section 9010--
       ``(A) $50,000,000 for fiscal year 2003; and
       ``(B) $30,000,000 for each of fiscal years 2004 through 
     2008.''.
       (c) Technical Amendments.--(1) Section 1001 of the Solid 
     Waste Disposal Act (42 U.S.C. prec. 6901) is amended by 
     striking the item relating to section 9010 and inserting the 
     following:

``Sec. 9010. Release prevention and compliance.
``Sec. 9011. Authorization of appropriations.''.
       (2) Section 9001(3)(A) of the Solid Waste Disposal Act (42 
     U.S.C. 6991(3)(A)) is amended by striking ``sustances'' and 
     inserting ``substances''.
       (3) Section 9003(f)(1) of the Solid Waste Disposal Act (42 
     U.S.C. 6991b(f)(1)) is amended by striking ``subsection (c) 
     and (d) of this section'' and inserting ``subsections (c) and 
     (d)''.
       (4) Section 9004(a) of the Solid Waste Disposal Act (42 
     U.S.C. 6991c(a)) is amended in the second sentence by 
     striking ``referred to'' and all that follows and inserting 
     ``referred to in subparagraph (A) or (B), or both, of section 
     9001(2).''.
       (5) Section 9005 of the Solid Waste Disposal Act (42 U.S.C. 
     6991d) is amended--
       (A) in subsection (a), by striking ``study taking'' and 
     inserting ``study, taking'';
       (B) in subsection (b)(1), by striking ``relevent'' and 
     inserting ``relevant''; and
       (C) in subsection (b)(4), by striking ``Evironmental'' and 
     inserting ``Environmental''.

     SEC. __13. RESTRICTIONS ON THE USE OF MTBE.

       (a) Findings.--Congress finds that--
       (1) since 1979, methyl tertiary butyl ether (referred to in 
     this section as ``MTBE'') has been used nationwide at low 
     levels in gasoline to replace lead as an octane booster or 
     anti-knocking agent;
       (2) Public Law 101-549 (commonly known as the ``Clean Air 
     Act Amendments of 1990'') (42 U.S.C. 7401 et seq.) 
     established a fuel oxygenate standard under which 
     reformulated gasoline must contain at least 2 percent oxygen 
     by weight;
       (3) at the time of the adoption of the fuel oxygenate 
     standard, Congress was aware that--
       (A) significant use of MTBE could result from the adoption 
     of that standard; and
       (B) the use of MTBE would likely be important to the cost-
     effective implementation of that standard;
       (4) Congress is aware that gasoline and its component 
     additives have leaked from storage tanks, with consequences 
     for water quality;
       (5) the fuel industry responded to the fuel oxygenate 
     standard established by Public Law 101-549 by making 
     substantial investments in--
       (A) MTBE production capacity; and
       (B) systems to deliver MTBE-containing gasoline to the 
     marketplace;
       (6) when leaked or spilled into the environment, MTBE may 
     cause serious problems of drinking water quality;
       (7) in recent years, MTBE has been detected in water 
     sources throughout the United States;
       (8) MTBE can be detected by smell and taste at low 
     concentrations;
       (9) while small quantities of MTBE can render water 
     supplies unpalatable, the precise human health effects of 
     MTBE consumption at low levels are yet unknown as of the date 
     of enactment of this Act;
       (10) in the report entitled ``Achieving Clean Air and Clean 
     Water: The Report of the Blue Ribbon Panel on Oxygenates in 
     Gasoline'' and dated September 1999, Congress was urged--
       (A) to eliminate the fuel oxygenate standard;
       (B) to greatly reduce use of MTBE; and
       (C) to maintain the environmental performance of 
     reformulated gasoline;
       (11) Congress has--
       (A) reconsidered the relative value of MTBE in gasoline; 
     and
       (B) decided to eliminate use of MTBE as a fuel additive;
       (12) the timeline for elimination of use of MTBE as a fuel 
     additive must be established in a manner that achieves an 
     appropriate balance among the goals of--
       (A) environmental protection;
       (B) adequate energy supply; and
       (C) reasonable fuel prices; and
       (13) it is appropriate for Congress to provide some limited 
     transition assistance--
       (A) to merchant producers of MTBE who produced MTBE in 
     response to a market created by the oxygenate requirement 
     contained in the Clean Air Act (42 U.S.C. 7401 et seq.); and
       (B) for the purpose of mitigating any fuel supply problems 
     that may result from elimination of a widely-used fuel 
     additive.
       (b) Purposes.--The purposes of this section are--
       (1) to eliminate use of MTBE as a fuel oxygenate; and
       (2) to provide assistance to merchant producers of MTBE in 
     making the transition from producing MTBE to producing other 
     fuel additives.
       (c) Authority for Water Quality Protection From Fuels.--
     Section 211(c) of the Clean Air Act (42 U.S.C. 7545(c)) is 
     amended--
       (1) in paragraph (1)(A)--
       (A) by inserting ``fuel or fuel additive or'' after 
     ``Administrator any''; and
       (B) by striking ``air pollution which'' and inserting ``air 
     pollution, or water pollution, that'';
       (2) in paragraph (4)(B), by inserting ``or water quality 
     protection,'' after ``emission control,''; and
       (3) by adding at the end the following:
       ``(5) Restrictions on use of mtbe.--
       ``(A) In general.--Subject to subparagraph (E), not later 
     than 4 years after the date of enactment of this paragraph, 
     the use of methyl tertiary butyl ether in motor vehicle fuel 
     in any State other than a State described in subparagraph (C) 
     is prohibited.
       ``(B) Regulations.--The Administrator shall promulgate 
     regulations to effect the prohibition in subparagraph (A).

[[Page 7673]]

       ``(C) States that authorize use.--A State described in this 
     subparagraph is a State that submits to the Administrator a 
     notice that the State authorizes use of methyl tertiary butyl 
     ether in motor vehicle fuel sold or used in the State.
       ``(D) Publication of notice.--The Administrator shall 
     publish in the Federal Register each notice submitted by a 
     State under subparagraph (C).
       ``(E) Trace quantities.--In carrying out subparagraph (A), 
     the Administrator may allow trace quantities of methyl 
     tertiary butyl ether, not to exceed 0.5 percent by volume, to 
     be present in motor vehicle fuel in cases that the 
     Administrator determines to be appropriate.
       ``(6) MTBE merchant producer conversion assistance.--
       ``(A) In general.--
       ``(i) Grants.--The Secretary of Energy, in consultation 
     with the Administrator, may make grants to merchant producers 
     of methyl tertiary butyl ether in the United States to assist 
     the producers in the conversion of eligible production 
     facilities described in subparagraph (C) to the production 
     of--
       ``(i) iso-octane or alkylates, unless the Administrator, in 
     consultation with the Secretary of Energy, determines that 
     transition assistance for the production of iso-octane or 
     alkylates is inconsistent with the criteria specified in 
     subparagraph (B); and
       ``(ii) any other fuel additive that meets the criteria 
     specified in subparagraph (B).
       ``(B) Criteria.--The criteria referred to in subparagraph 
     (A) are that--
       ``(i) use of the fuel additive is consistent with this 
     subsection;
       ``(ii) the Administrator has not determined that the fuel 
     additive may reasonably be anticipated to endanger public 
     health or the environment;
       ``(iii) the fuel additive has been registered and tested, 
     or is being tested, in accordance with the requirements of 
     this section; and
       ``(iv) the fuel additive will contribute to replacing 
     quantities of motor vehicle fuel rendered unavailable as a 
     result of paragraph (5).
       ``(C) Eligible production facilities.--A production 
     facility shall be eligible to receive a grant under this 
     paragraph if the production facility--
       ``(i) is located in the United States; and
       ``(ii) produced methyl tertiary butyl ether for consumption 
     in nonattainment areas during the period--

       ``(I) beginning on the date of enactment of this paragraph; 
     and
       ``(II) ending on the effective date of the prohibition on 
     the use of methyl tertiary butyl ether under paragraph (5).

       ``(D) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this paragraph $250,000,000 
     for each of fiscal years 2004 through 2007.''.
       (d) No Effect on Law Concerning State Authority.--The 
     amendments made by subsection (c) have no effect on the law 
     in effect on the day before the date of enactment of this Act 
     concerning the authority of States to limit the use of methyl 
     tertiary butyl ether in motor vehicle fuel.

     SEC. __14. ELIMINATION OF OXYGEN CONTENT REQUIREMENT FOR 
                   REFORMULATED GASOLINE.

       (a) Elimination.--
       (1) In general.--Section 211(k) of the Clean Air Act (42 
     U.S.C. 7545(k)) is amended--
       (A) in paragraph (2)--
       (i) in the second sentence of subparagraph (A), by striking 
     ``(including the oxygen content requirement contained in 
     subparagraph (B))'';
       (ii) by striking subparagraph (B); and
       (iii) by redesignating subparagraphs (C) and (D) as 
     subparagraphs (B) and (C), respectively;
       (B) in paragraph (3)(A), by striking clause (v); and
       (C) in paragraph (7)--
       (i) in subparagraph (A)--

       (I) by striking clause (i); and
       (II) by redesignating clauses (ii) and (iii) as clauses (i) 
     and (ii), respectively; and

       (ii) in subparagraph (C)--

       (I) by striking clause (ii); and
       (II) by redesignating clause (iii) as clause (ii).

       (2) Applicability.--The amendments made by paragraph (1) 
     apply--
       (A) in the case of a State that has received a waiver under 
     section 209(b) of the Clean Air Act (42 U.S.C. 7543(b)), 
     beginning on the date of enactment of this Act; and
       (B) in the case of any other State, beginning 270 days 
     after the date of enactment of this Act.
       (b) Maintenance of Toxic Air Pollutant Emission 
     Reductions.--Section 211(k)(1) of the Clean Air Act (42 
     U.S.C. 7545(k)(1)) is amended--
       (1) by striking ``Within 1 year after the enactment of the 
     Clean Air Act Amendments of 1990,'' and inserting the 
     following:
       ``(A) In general.--Not later than November 15, 1991,''; and
       (2) by adding at the end the following:
       ``(B) Maintenance of toxic air pollutant emissions 
     reductions from reformulated gasoline.--
       ``(i) Definition of padd.--In this subparagraph the term 
     `PADD' means a Petroleum Administration for Defense District.
       ``(ii) Regulations concerning emissions of toxic air 
     pollutants.--Not later than 270 days after the date of 
     enactment of this subparagraph, the Administrator shall 
     establish by regulation, for each refinery or importer (other 
     than a refiner or importer in a State that has received a 
     waiver under section 209(b) with respect to gasoline produced 
     for use in that State), standards for toxic air pollutants 
     from use of the reformulated gasoline produced or distributed 
     by the refiner or importer that maintain the reduction of the 
     average annual aggregate emissions of toxic air pollutants 
     for reformulated gasoline produced or distributed by the 
     refiner or importer during calendar years 1999 and 2000 (as 
     determined on the basis of data collected by the 
     Administrator with respect to the refiner or importer).
       ``(iii) Standards applicable to specific refineries or 
     importers.--

       ``(I) Applicability of standards.--For any calendar year, 
     the standards applicable to a refiner or importer under 
     clause (ii) shall apply to the quantity of gasoline produced 
     or distributed by the refiner or importer in the calendar 
     year only to the extent that the quantity is less than or 
     equal to the average annual quantity of reformulated gasoline 
     produced or distributed by the refiner or importer during 
     calendar years 1999 and 2000.
       ``(II) Applicability of other standards.--For any calendar 
     year, the quantity of gasoline produced or distributed by a 
     refiner or importer that is in excess of the quantity subject 
     to subclause (I) shall be subject to standards for emissions 
     of toxic air pollutants promulgated under subparagraph (A) 
     and paragraph (3)(B).

       ``(iv) Credit program.--The Administrator shall provide for 
     the granting and use of credits for emissions of toxic air 
     pollutants in the same manner as provided in paragraph (7).
       ``(v) Regional protection of toxics reduction baselines.--

       ``(I) In general.--Not later than 60 days after the date of 
     enactment of this subparagraph, and not later than April 1 of 
     each calendar year that begins after that date of enactment, 
     the Administrator shall publish in the Federal Register a 
     report that specifies, with respect to the previous calendar 
     year--

       ``(aa) the quantity of reformulated gasoline produced that 
     is in excess of the average annual quantity of reformulated 
     gasoline produced in 1999 and 2000; and
       ``(bb) the reduction of the average annual aggregate 
     emissions of toxic air pollutants in each PADD, based on 
     retail survey data or data from other appropriate sources.

       ``(II) Effect of failure to maintain aggregate toxics 
     reductions.--If, in any calendar year, the reduction of the 
     average annual aggregate emissions of toxic air pollutants in 
     a PADD fails to meet or exceed the reduction of the average 
     annual aggregate emissions of toxic air pollutants in the 
     PADD in calendar years 1999 and 2000, the Administrator, not 
     later than 90 days after the date of publication of the 
     report for the calendar year under subclause (I), shall--

       ``(aa) identify, to the maximum extent practicable, the 
     reasons for the failure, including the sources, volumes, and 
     characteristics of reformulated gasoline that contributed to 
     the failure; and
       ``(bb) promulgate revisions to the regulations promulgated 
     under clause (ii), to take effect not earlier than 180 days 
     but not later than 270 days after the date of promulgation, 
     to provide that, notwithstanding clause (iii)(II), all 
     reformulated gasoline produced or distributed at each refiner 
     or importer shall meet the standards applicable under clause 
     (iii)(I) beginning not later than April 1 of the calendar 
     year following publication of the report under subclause (I) 
     and in each calendar year thereafter.
       ``(vi) Regulations to control hazardous air pollutants from 
     motor vehicles and motor vehicle fuels.--Not later than July 
     1, 2004, the Administrator shall promulgate final regulations 
     to control hazardous air pollutants from motor vehicles and 
     motor vehicle fuels, as provided for in section 80.1045 of 
     title 40, Code of Federal Regulations (as in effect on the 
     date of enactment of this subparagraph).''.
       (c) Commingling.--
       (1) In general.--Section 211(k) of the Clean Air Act (42 
     U.S.C. 7545(k)) is amended by adding at the end the 
     following:
       ``(11) Commingling.--The regulations under paragraph (1) 
     shall permit the commingling at a retail station of 
     reformulated gasoline containing ethanol and reformulated 
     gasoline that does not contain ethanol if, each time such 
     commingling occurs--
       ``(A) the retailer notifies the Administrator before the 
     commingling, identifying the exact location of the retail 
     station and the specific tank in which the commingling will 
     take place; and
       ``(B) the retailer certifies that the reformulated gasoline 
     resulting from the commingling will meet all applicable 
     requirements for reformulated gasoline, including content and 
     emission performance standards.
       (d) Consolidation in Reformulated Gasoline Regulations.--
     Not later than 180 days after the date of enactment of this 
     Act, the Administrator of the Environmental Protection Agency 
     shall revise the reformulated gasoline regulations under 
     subpart D of part

[[Page 7674]]

     80 of title 40, Code of Federal Regulations, to consolidate 
     the regulations applicable to VOC-Control Regions 1 and 2 
     under section 80.41 of that title by eliminating the less 
     stringent requirements applicable to gasoline designated for 
     VOC-Control Region 2 and instead applying the more stringent 
     requirements applicable to gasoline designated for VOC-
     Control Region 1.
       (e) Savings Clause.--
       (1) In general.--Nothing in this section or any amendment 
     made by this section affects or prejudices any legal claim or 
     action with respect to regulations promulgated by the 
     Administrator before the date of enactment of this Act 
     regarding--
       (A) emissions of toxic air pollutants from motor vehicles; 
     or
       (B) the adjustment of standards applicable to a specific 
     refinery or importer made under those regulations.
       (2) Adjustment of standards.--
       (A) Applicability.--The Administrator may apply any 
     adjustments to the standards applicable to a refinery or 
     importer under subparagraph (B)(iii)(I) of section 211(k)(1) 
     of the Clean Air Act (as added by subsection (b)(2)), except 
     that--
       (i) the Administrator shall revise the adjustments to be 
     based only on calendar years 1999 and 2000;
       (ii) any such adjustment shall not be made at a level below 
     the average percentage of reductions of emissions of toxic 
     air pollutants for reformulated gasoline supplied to PADD I 
     during calendar years 1999 and 2000; and
       (iii) in the case of an adjustment based on toxic air 
     pollutant emissions from reformulated gasoline significantly 
     below the national annual average emissions of toxic air 
     pollutants from all reformulated gasoline--

       (I) the Administrator may revise the adjustment to take 
     account of the scope of the prohibition on methyl tertiary 
     butyl ether imposed by paragraph (5) of section 211(c) of the 
     Clean Air Act (as added by section 203(c)); and
       (II) any such adjustment shall require the refiner or 
     importer, to the maximum extent practicable, to maintain the 
     reduction achieved during calendar years 1999 and 2000 in the 
     average annual aggregate emissions of toxic air pollutants 
     from reformulated gasoline produced or distributed by the 
     refiner or importer.

     SEC. __15. PUBLIC HEALTH AND ENVIRONMENTAL IMPACTS OF FUELS 
                   AND FUEL ADDITIVES.

       Section 211(b) of the Clean Air Act (42 U.S.C. 7545(b)) is 
     amended--
       (1) in paragraph (2)--
       (A) by striking ``may also'' and inserting ``shall, on a 
     regular basis,''; and
       (B) by striking subparagraph (A) and inserting the 
     following:
       ``(A) to conduct tests to determine potential public health 
     and environmental effects of the fuel or additive (including 
     carcinogenic, teratogenic, or mutagenic effects); and''; and
       (2) by adding at the end the following:
       ``(4) Study on certain fuel additives and blendstocks.--
       ``(A) In general.--Not later than 2 years after the date of 
     enactment of this paragraph, the Administrator shall--
       ``(i) conduct a study on the effects on public health 
     (including the effects on children, pregnant women, minority 
     or low-income communities, and other sensitive populations), 
     air quality, and water resources of increased use of, and the 
     feasibility of using as substitutes for methyl tertiary butyl 
     ether in gasoline--

       ``(I) ethyl tertiary butyl ether;
       ``(II) tertiary amyl methyl ether;
       ``(III) di-isopropyl ether;
       ``(IV) tertiary butyl alcohol;
       ``(V) other ethers and heavy alcohols, as determined by 
     then Administrator;
       ``(VI) ethanol;
       ``(VII) iso-octane; and
       ``(VIII) alkylates; and

       ``(ii) conduct a study on the effects on public health 
     (including the effects on children, pregnant women, minority 
     or low-income communities, and other sensitive populations), 
     air quality, and water resources of the adjustment for 
     ethanol-blended reformulated gasoline to the volatile organic 
     compounds performance requirements that are applicable under 
     paragraphs (1) and (3) of section 211(k); and
       ``(iii) submit to the Committee on Environment and Public 
     Works of the Senate and the Committee on Energy and Commerce 
     of the House of Representatives a report describing the 
     results of the studies under clauses (i) and (ii).
       ``(B) Contracts for study.--In carrying out this paragraph, 
     the Administrator may enter into 1 or more contracts with 
     nongovernmental entities such as--
       ``(i) the national energy laboratories; and
       ``(ii) institutions of higher education (as defined in 
     section 101 of the Higher Education Act of 1965 (20 U.S.C. 
     1001)).''.

     SEC. __16. ANALYSES OF MOTOR VEHICLE FUEL CHANGES.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) (as 
     amended by section __01(a)) is amended by inserting after 
     subsection (o) the following:
       ``(p) Analyses of Motor Vehicle Fuel Changes and Emissions 
     Model.--
       ``(1) Anti-backsliding analysis.--
       ``(A) Draft analysis.--Not later than 4 years after the 
     date of enactment of this paragraph, the Administrator shall 
     publish for public comment a draft analysis of the changes in 
     emissions of air pollutants and air quality due to the use of 
     motor vehicle fuel and fuel additives resulting from 
     implementation of the amendments made by the Reliable Fuels 
     Act.
       ``(B) Final analysis.--After providing a reasonable 
     opportunity for comment but not later than 5 years after the 
     date of enactment of this paragraph, the Administrator shall 
     publish the analysis in final form.
       ``(2) Emissions model.--For the purposes of this 
     subsection, as soon as the necessary data are available, the 
     Administrator shall develop and finalize an emissions model 
     that reasonably reflects the effects of gasoline 
     characteristics or components on emissions from vehicles in 
     the motor vehicle fleet during calendar year 2006.''.

     SEC. __17. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED 
                   GASOLINE PROGRAM.

       Section 211(k)(6) of the Clean Air Act (42 U.S.C. 
     7545(k)(6)) is amended--
       (1) by striking ``(6) Opt-in areas.--(A) Upon'' and 
     inserting the following:
       ``(6) Opt-in areas.--
       ``(A) Classified areas.--
       ``(i) In general.--Upon'';
       (2) in subparagraph (B), by striking ``(B) If'' and 
     inserting the following:
       ``(ii) Effect of insufficient domestic capacity to produce 
     reformulated gasoline.--If'';
       (3) in subparagraph (A)(ii) (as redesignated by paragraph 
     (2))--
       (A) in the first sentence, by striking ``subparagraph (A)'' 
     and inserting ``clause (i)''; and
       (B) in the second sentence, by striking ``this paragraph'' 
     and inserting ``this subparagraph''; and
       (4) by adding at the end the following:
       ``(B) Ozone transport region.--
       ``(i) Application of prohibition.--

       ``(I) In general.--On application of the Governor of a 
     State in the ozone transport region established by section 
     184(a), the Administrator, not later than 180 days after the 
     date of receipt of the application, shall apply the 
     prohibition specified in paragraph (5) to any area in the 
     State (other than an area classified as a marginal, moderate, 
     serious, or severe ozone nonattainment area under subpart 2 
     of part D of title I) unless the Administrator determines 
     under clause (iii) that there is insufficient capacity to 
     supply reformulated gasoline.
       ``(II) Publication of application.--As soon as practicable 
     after the date of receipt of an application under subclause 
     (I), the Administrator shall publish the application in the 
     Federal Register.

       ``(ii) Period of applicability.--Under clause (i), the 
     prohibition specified in paragraph (5) shall apply in a 
     State--

       ``(I) commencing as soon as practicable but not later than 
     2 years after the date of approval by the Administrator of 
     the application of the Governor of the State; and
       ``(II) ending not earlier than 4 years after the 
     commencement date determined under subclause (I).

       ``(iii) Extension of commencement date based on 
     insufficient capacity.--

       ``(I) In general.--If, after receipt of an application from 
     a Governor of a State under clause (i), the Administrator 
     determines, on the Administrator's own motion or on petition 
     of any person, after consultation with the Secretary of 
     Energy, that there is insufficient capacity to supply 
     reformulated gasoline, the Administrator, by regulation--

       ``(aa) shall extend the commencement date with respect to 
     the State under clause (ii)(I) for not more than 1 year; and
       ``(bb) may renew the extension under item (aa) for 2 
     additional periods, each of which shall not exceed 1 year.

       ``(II) Deadline for action on petitions.--The Administrator 
     shall act on any petition submitted under subclause (I) not 
     later than 180 days after the date of receipt of the 
     petition.''.

     SEC. __18. FEDERAL ENFORCEMENT OF STATE FUELS REQUIREMENTS.

       Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
     7545(c)(4)(C)) is amended--
       (1) by striking ``(C) A State'' and inserting the 
     following:
       ``(C) Authority of state to control fuels and fuel 
     additives for reasons of necessity.--
       ``(i) In general.--A State''; and
       (2) by adding at the end the following:
       ``(ii) Enforcement by the administrator.--In any case in 
     which a State prescribes and enforces a control or 
     prohibition under clause (i), the Administrator, at the 
     request of the State, shall enforce the control or 
     prohibition as if the control or prohibition had been adopted 
     under the other provisions of this section.''.

     SEC. __19. FUEL SYSTEM REQUIREMENTS HARMONIZATION STUDY.

       (a) Study.--
       (1) In general.--The Administrator of the Environmental 
     Protection Agency and the Secretary of Energy shall jointly 
     conduct a study of Federal, State, and local requirements 
     concerning motor vehicle fuels, including--
       (A) requirements relating to reformulated gasoline, 
     volatility (measured in Reid vapor

[[Page 7675]]

     pressure), oxygenated fuel, and diesel fuel; and
       (B) other requirements that vary from State to State, 
     region to region, or locality to locality.
       (2) Required elements.--The study shall assess--
       (A) the effect of the variety of requirements described in 
     paragraph (1) on the supply, quality, and price of motor 
     vehicle fuels available to the consumer;
       (B) the effect of the requirements described in paragraph 
     (1) on achievement of--
       (i) national, regional, and local air quality standards and 
     goals; and
       (ii) related environmental and public health protection 
     standards and goals (including the protection of children, 
     pregnant women, minority or low-income communities, and other 
     sensitive populations);
       (C) the effect of Federal, State, and local motor vehicle 
     fuel regulations, including multiple motor vehicle fuel 
     requirements, on--
       (i) domestic refiners;
       (ii) the fuel distribution system; and
       (iii) industry investment in new capacity;
       (D) the effect of the requirements described in paragraph 
     (1) on emissions from vehicles, refiners, and fuel handling 
     facilities;
       (E) the feasibility of developing national or regional 
     motor vehicle fuel slates for the 48 contiguous States that, 
     while protecting and improving air quality at the national, 
     regional, and local levels, could--
       (i) enhance flexibility in the fuel distribution 
     infrastructure and improve fuel fungibility;
       (ii) reduce price volatility and costs to consumers and 
     producers;
       (iii) provide increased liquidity to the gasoline market; 
     and
       (iv) enhance fuel quality, consistency, and supply; and
       (F) the feasibility of providing incentives, and the need 
     for the development of national standards necessary, to 
     promote cleaner burning motor vehicle fuel.
       (b) Report.--
       (1) In general.--Not later than June 1, 2007, the 
     Administrator of the Environmental Protection Agency and the 
     Secretary of Energy shall submit to Congress a report on the 
     results of the study conducted under subsection (a).
       (2) Recommendations.--
       (A) In general.--The report shall contain recommendations 
     for legislative and administrative actions that may be 
     taken--
       (i) to improve air quality;
       (ii) to reduce costs to consumers and producers; and
       (iii) to increase supply liquidity.
       (B) Required considerations.--The recommendations under 
     subparagraph (A) shall take into account the need to provide 
     advance notice of required modifications to refinery and fuel 
     distribution systems in order to ensure an adequate supply of 
     motor vehicle fuel in all States.
       (3) Consultation.--In developing the report, the 
     Administrator of the Environmental Protection Agency and the 
     Secretary of Energy shall consult with--
       (A) the Governors of the States;
       (B) automobile manufacturers;
       (C) State and local air pollution control regulators;
       (D) public health experts;
       (E) motor vehicle fuel producers and distributors; and
       (F) the public.
                                 ______
                                 
  SA 3051. Mr. DOMENICI proposed an amendment to amendment SA 3050 
proposed by Mr. Daschle (for himself, Mr. Durbin, and Mr. Johnson) to 
the bill S. 150, to make permanent the moratorium on taxes on Internet 
access and multiple and discriminatory taxes on electronic commerce 
imposed by the Internet Tax Freedom Act; as follows:
  (The amendment will be printed in a future edition of the Record.)

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