[House Report 109-535]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     109-535

======================================================================

 
 TO ESTABLISH A GRANT PROGRAM WHEREBY MONEYS COLLECTED FROM VIOLATIONS 
   OF THE CORPORATE AVERAGE FUEL ECONOMY PROGRAM ARE USED TO EXPAND 
 INFRASTRUCTURE NECESSARY TO INCREASE THE AVAILABILITY OF ALTERNATIVE 
                                 FUELS

                                _______
                                

 June 28, 2006.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Barton of Texas, from the Committee on Energy and Commerce, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 5534]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 5534) to establish a grant program whereby 
moneys collected from violations of the corporate average fuel 
economy program are used to expand infrastructure necessary to 
increase the availability of alternative fuels, having 
considered the same, report favorably thereon without amendment 
and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     2
Committee Consideration..........................................     2
Committee Votes..................................................     2
Committee Oversight Findings.....................................     2
Statement of General Performance Goals and Objectives............     2
New Budget Authority, Entitlement Authority, and Tax Expenditures     3
Committee Cost Estimate..........................................     3
Congressional Budget Office Estimate.............................     3
Federal Mandates Statement.......................................     4
Advisory Committee Statement.....................................     4
Constitutional Authority Statement...............................     4
Applicability to Legislative Branch..............................     5
Section-by-Section Analysis of the Legislation...................     5
Changes in Existing Law Made by the Bill, as Reported............     5

                          PURPOSE AND SUMMARY

    The purpose of H.R. 5534 is to establish a grant program 
whereby moneys collected from violations of the Corporate 
Average Fuel Economy program are used to expand infrastructure 
necessary to increase the availability of alternative fuels.

                  BACKGROUND AND NEED FOR LEGISLATION

    Today, nearly six million Americans drive flex-fuel 
vehicles. These cars are capable of running on gasoline or 
renewable fuels like E-85, which is 85 percent ethanol. 
Unfortunately, renewable fuels infrastructure has not kept pace 
with the number of renewable fueled cars on the road, and today 
only approximately 800 gas stations have E-85 pumps installed, 
which is less than 1 percent of all gas stations.
    With gas prices at record highs, there is great interest in 
reducing the country's dependence on foreign oil by making 
alternative fuels more available to drivers. To achieve this, 
H.R. 5534 uses the penalties automakers pay for failing to meet 
Corporate Average Fuel Economy (CAFE) standards to provide 
grants to install alternative fuel infrastructure.
    In particular, H.R. 5534 allows independent gas stations to 
apply for targeted grants of $30,000 to be used for the 
installation of E-85 pumps and other alternative fuel 
infrastructure. With approximately $20 million collected from 
CAFE penalties annually, this legislation could double the 
number of alternative fuel pumps in the United States in one 
year.

                                HEARINGS

    The Committee on Energy and Commerce has not held hearings 
on the legislation.

                        COMMITTEE CONSIDERATION

    On Tuesday, June 20, 2006, the Committee on Energy and 
Commerce met in open markup session and ordered H.R. 5534 
reported to the House, without amendment, by a voice vote, a 
quorum being present.

                            COMMITTEE VOTES

    There were no record votes taken in connection with 
ordering H.R. 5534 reported. A motion by Mr. Barton to order 
H.R. 5534 reported to the House, with amendment, was agreed to 
by a voice vote.

                      COMMITTEE OVERSIGHT FINDINGS

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee has not held oversight 
or legislative hearings on this legislation.

         STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

    The goal of H.R. 5534 is to establish a grant program 
whereby moneys collected from violations of the Corporate 
Average Fuel Economy program are used to expand infrastructure 
necessary to increase the availability of alternative fuels.

   NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
5534, would result in no new or increased budget authority, 
entitlement authority, or tax expenditures or revenues.

                        COMMITTEE COST ESTIMATE

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  CONGRESSIONAL BUDGET OFFICE ESTIMATE

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                                     June 22, 2006.
Hon. Joe Barton,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 5534, a bill to 
establish a grant program whereby moneys collected from 
violations of the corporate average fuel economy program are 
used to expand infrastructure necessary to increase the 
availability of alternative fuels.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Leigh 
Angres and Megan Carroll.
            Sincerely,
                                          Donald B. Marron,
                                                   Acting Director.
    Enclosure.

H.R. 5534--A bill to establish a grant program whereby moneys collected 
        from violations of the corporate average fuel economy program 
        are used to expand infrastructure necessary to increase the 
        availability of alternative fuels

    Summary: H.R. 5534 would establish a Department of Energy 
(DOE) grant program to support the installation of equipment at 
gas stations for the delivery of alternative fuels. CBO 
estimates enacting the bill would increase direct spending by 
$5 million in 2007 and by $225 million over the 2007-2016 
period because it would authorize spending without further 
appropriation of amounts currently collected for violations of 
corporate average fuel economy (CAFE) standards. Enacting the 
bill would not affect revenues.
    H.R. 5534 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA); 
the bill would benefit State, local, and tribal governments and 
any costs would be incurred voluntarily.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 5534 is shown in the following table. 
The costs of this legislation fall within budget function 270 
(energy).

----------------------------------------------------------------------------------------------------------------
                                                     By fiscal year, in millions of dollars--
                                 -------------------------------------------------------------------------------
                                   2007    2008    2009    2010    2011    2012    2013    2014    2015    2016
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING

Estimated Budget Authority......      25      25      25      25      25      25      25      25      25      25
Estimated Outlays...............       5      20      25      25      25      25      25      25      25      25
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: Under current law, the Department of 
Transportation charges penalties for automakers' violations of 
CAFE standards. In recent years, such collections have ranged 
from $51 million in 2000 to $5 million in 2003. H.R. 5534 would 
require that the penalties be transferred to a new interest-
bearing fund. Amounts in the proposed fund would be available, 
without further appropriation, to DOE for a grant program to 
support the installation of equipment at gas stations for the 
delivery of alternative motor fuels.
    CBO estimates the fines that would be directed to the 
proposed fund would total $24 million annually, and interest on 
the balance of the fund would total about $1 million annually. 
Based on spending patterns of similar grant programs 
administered by DOE, CBO estimates enacting the bill would 
increase direct spending by $5 million in 2007 and by $225 
million over the 2007-2016 time period.
    Intergovernmental and private-sector impact: H.R. 5534 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. Grants established by the bill may benefit 
State, local, and tribal governments that choose to construct 
or expand infrastructure to increase access to alternative 
fuels. Any costs they might incur would result from complying 
with conditions of federal assistance.
    Estimate prepared by: Federal Costs: Leigh Angres and Megan 
Carroll. Federal Revenues: Emily Schlect. Impact on State, 
Local, and Tribal Governments: Lisa Ramirez-Branum. Impact on 
the Private Sector: Craig Cammarata.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                       FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Fuel Economy Fund and Alternative Fuel Grant Program

    Section 1(a)(1) creates a Fuel Economy Fund (Fund) with 
amounts transferred to the Fund from the total amount deposited 
in the general fund of the Treasury in the preceding fiscal 
year from fines, penalties, and other moneys collected under 
the CAFE program (49 U.S.C. 32912). The Secretary of Energy 
(Secretary) is directed to invest such portion of the Fund that 
is not required to meet current withdrawals in interest bearing 
obligations of the United States. The amounts in the Fund shall 
be made available to the Secretary to carry out the grant 
program.
    Section 1(b) requires the Secretary to establish and carry 
out a grant program to expand the availability of alternative 
fuels through the Clean Cities Program administered through the 
Department of Energy. Any entity eligible for assistance 
through the Clean Cities program will be eligible for a grant 
under this section, except that no grant shall be awarded to a 
large, vertically integrated oil company. Grants shall not 
exceed $30,000, or $60,000 in any fiscal year. The grants under 
this section shall be used for the construction or expansion of 
infrastructure necessary to increase the availability to 
consumers of alternative fuels (as defined in 49 U.S.C. 
32901(a)(1)). Not more than three percent of grant funds may be 
used for administrative costs.

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    This legislation does not amend any existing Federal 
statute.

                                  
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