I

103D CONGRESS

1ST SESSION H. R. 3546

To provide for the establishment of a program for safety, development, and

education in the propane gas industry for the benefit of propane consumers and the public, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

NOVEMBER 19, 1993

Mr. TAUZIN (for himself, Mr. OXLEY, Mrs. FOWLER, Mr. ENGLISH of Oklahoma, Mr. JEFFERSON, Mr. SMITH of New Jersey, Mr. UPTON, Mr.

JACOB, Mr. BARCIA of Michigan, Mr. BACHUS of Alabama, Mr. BEVILL,

Mr. GILMAN, Mr. STUMP, Mr. DICKEY, Mr. HANCOCK, Mr. MCCRERY,

Mr. INHOFF, Mr. PAYNE of Virginia, Mr. EMERSON, Mr. SKELTON, Mr.

LANCASTER, Mr. BRYANT, and Mr. BISHOP) introduced the following bill;

which was referred jointly to the Committees on Energy and Commerce

and Science, Space, and Technology

A BILL

To provide for the establishment of a program for safety,

development, and education in the propane gas industry

for the benefit of propane consumers and the public,

and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Propane Education

5 and Research Act of 1993’’.
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1 SEC. 2. FINDINGS.

2 The Congress finds that—

3 (1) propane gas, or liquefied petroleum gas, is

4 an essential energy commodity providing heat, hot

5 water, cooking fuel, and motor fuel among its many

6 uses to millions of Americans;

7 (2) the use of propane is especially important to

8 rural citizens and farmers, offering an efficient and

9 economical source of gas energy;

10 (3) propane has been recognized as a clean fuel

11 and can contribute in many ways to reducing the

12 pollution in our cities and towns; and

13 (4) propane is primarily domestically produced

14 and its use provides energy security and jobs for

15 Americans.

16 SEC. 3. DEFINITIONS.

17 For the purposes of this Act—

18 (1) the term ‘‘Council’’ means the Propane

19 Education and Research Council created pursuant to

20 section 4 of this Act;

21 (2) the term ‘‘industry’’ means those persons

22 involved in the production, transportation, and sale

23 of propane, and in the manufacture and distribution

24 of propane utilization equipment, in the United

25 States;
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1 (3) the term ‘‘industry trade association’’

2 means an organization exempt from tax, under sec3 tion 501(c)(3) or (6) of the Internal Revenue Code

4 of 1986, representing the propane industry;

5 (4) the term ‘‘odorized propane’’ means pro6 pane which has had odorant added to it;

7 (5) the term ‘‘producer’’ means the owner of

8 the propane at the time it is recovered at a manu9 facturing facility;

10 (6) the term ‘‘propane’’ means a hydrocarbon

whose chemical composition is predominantly C3H8 11 ,

12 whether recovered from natural gas or crude oil;

13 (7) the term ‘‘public member’’ means a member

14 of the Council, other than a representative of pro15 ducers or retail marketers, representing significant

16 users of propane, public safety officials, academia,

17 the propane research community, or other groups

18 knowledgeable about propane;

19 (8) the term ‘‘qualified industry organization’’

20 means the National Propane Gas Association, the

21 Gas Processors Association, a successor association

22 of such associations, or a group of retail marketers

23 or producers who collectively represent 25 percent of

24 the volume of propane sold or produced in the

25 United States;
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1 (9) the term ‘‘retail marketer’’ means a person

2 engaged primarily in the sale of odorized propane to

3 the ultimate consumer or to retail propane dispens4 ers;

5 (10) the term ‘‘retail propane dispenser’’ means

6 a person who sells odorized propane to the ultimate

7 consumer but is not engaged primarily in the busi8 ness of such sales; and

9 (11) the term ‘‘Secretary’’ means the Secretary

10 of Energy.

11 SEC. 4. REFERENDA.

12 (a) CREATION OF PROGRAM.—The Secretary shall

13 conduct a referendum as soon as possible among produc14 ers and retail marketers to authorize the creation of the

15 Propane Education and Research Council and the levying

16 of an assessment on odorized propane. Voting rights in

17 such referendum shall be based on the volume of propane

18 sold or produced in the previous calendar year or other

19 representative period. Upon approval of those persons rep20 resenting two-thirds of the total volume of propane voted

21 in the retail marketer class and two-thirds of all propane

22 voted in the producer class, the Secretary shall issue an

23 order establishing the Council. All persons voting in the

24 referendum shall certify to the Secretary the volume of

25 propane represented by their vote.
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1 (b) TERMINATION.—On the Secretary’s own initia2 tive, or on petition of the Council or of producers and re3 tail marketers representing 35 percent of the volume of

4 propane in each class, the Secretary shall hold a referen5 dum to determine whether the industry favors termination

6 or suspension of the order issued under subsection (a).

7 Termination or suspension shall not take effect unless it

8 is approved by persons representing more than one-half

9 of the total volume of odorized propane in the retail mar10 keter class and more than one-half of the total volume of

11 propane in the producer class.

12 SEC. 5. PROPANE EDUCATION AND RESEARCH COUNCIL.

13 (a) APPOINTMENT OF MEMBERS.—Upon issuance of

14 an order by the Secretary under section 4(a) establishing

15 the Propane Education and Research Council, the Sec16 retary shall select all retail marketer and producer mem17 bers of the Council from a list of nominees submitted by

18 qualified industry organizations. Nominees need not be

19 members of a qualified industry organization. The public

20 members of the Council shall be appointed by the Sec21 retary. Vacancies in unfinished terms of Council members

22 shall be filled in the same manner as were the original

23 appointments.

24 (b) REPRESENTATION.—In making nominations and

25 appointments to the Council, the qualified industry organi-
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1 zations and the Secretary shall give due regard to selecting

2 a Council that is representative of the industry, including

3 representation of—

4 (1) gas processors and oil refiners among pro5 ducers;

6 (2) interstate and intrastate operators among

7 retail marketers;

8 (3) large and small companies among producers

9 and retail marketers; and

10 (4) diverse geographic regions of the country.

11 (c) MEMBERSHIP.—The Council shall consist of 21

12 members, with 9 members representing retail marketers,

13 9 members representing producers, and 3 public members.

14 Other than the public members, Council members shall be

15 full-time employees or owners of businesses in the indus16 try. No employee of a qualified industry organization or

17 other industry trade association shall serve as a member

18 of the Council, and no member of the Council may serve

19 concurrently as an officer of the Board of Directors of

20 a qualified industry organization or other industry trade

21 association. Only one person at a time from any company

22 or its affiliate may serve on the Council.

23 (d) COMPENSATION.—Council members shall receive

24 no compensation for their services, nor shall Council mem25 bers be reimbursed for expenses relating to their service,
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1 except that public members, upon request, may be reim2 bursed for reasonable expenses directly related to their

3 participation in Council meetings.

4 (e) TERMS.—Council members shall serve terms of

5 3 years and may serve not more than 2 full terms. Mem6 bers filling unexpired terms may serve not more than a

7 total of 7 years. Former members of the Council may be

8 returned to the Council if they have not been members

9 for a period of 2 years. Initial appointments to the Council

10 shall be for terms of 1, 2, and 3 years, staggered to pro11 vide for the election of 7 members each year.

12 (f) FUNCTIONS.—The Council shall develop programs

13 and projects and enter into contracts or agreements for

14 implementing this Act, including programs to enhance

15 consumer safety, to provide for research and development

16 of clean and efficient propane utilization equipment, to in17 form and educate the public, to develop and preserve mar18 kets for propane, and to provide for the payment of the

19 costs thereof with funds collected pursuant to this Act.

20 The Council shall coordinate its activities with industry

21 trade association and others as appropriate to provide effi22 cient delivery of services and to avoid unnecessary duplica23 tion of activities.

24 (g) ADMINISTRATION.—The Council shall select from

25 among its members a Chairman and other officers as nec-
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1 essary, may establish committees and subcommittees of

2 the Council, and shall adopt rules and bylaws for the con3 duct of business and the implementation of this Act. The

4 Council shall establish procedures for the solicitation of

5 industry comment and recommendations on any signifi6 cant plans, programs, and projects to be funded by the

7 Council. The Council may establish advisory committees

8 of persons other than Council members.

9 (h) EMPLOYEES; ADMINISTRATIVE EXPENSES.—The

10 Council may employ a person to serve as Chief Executive

11 Officer and such other employees as it considers nec12 essary. The Council shall determine the compensation and

13 duties of each employee, and shall protect the handling

14 of Council funds through fidelity bonds. The administra15 tive expenses of operating the Council shall not exceed 10

16 percent of the funds collected in any fiscal year.

17 (i) BUDGET.—Before August 1 each year, the Coun18 cil shall publish for industry review and comment a budget

19 plan for the next calendar year, including the probable

20 costs of all programs, projects, and contracts and a rec21 ommended rate of assessment sufficient to cover such

22 costs. Following this review and comment, the Council

23 shall submit the proposed budget to the Secretary. The

24 Secretary shall recommend any changes the Secretary con-
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1 siders appropriate to the budget after an opportunity for

2 public comment.

3 (j) RECORDS; AUDITS.—The Council shall keep min4 utes, books, and records that clearly reflect all of the acts

5 and transactions of the Council and regularly report such

6 information to the Secretary, along with such other infor7 mation as the Secretary may require. The books of the

8 Council shall be audited by a certified public accountant

9 at least once each fiscal year and at such other times as

10 the Council may designate. Copies of such audit shall be

11 provided to the Secretary, all members of the Council, all

12 qualified industry organizations, and to other members of

13 the industry upon request. The Secretary shall receive no14 tice of meetings and may require reports on the activities

15 of the Council, as well as reports on compliance, violations,

16 and complaints regarding the implementation of this Act.

17 (k) REIMBURSEMENT OF FEDERAL EXPENSES.—

18 From assessments collected, the Council shall annually re19 imburse the Secretary for costs incurred in holding the

20 referendum establishing the Council, making appoint21 ments to the Council, and other expenses directly related

22 to the Council, not in excess of the cost of three employee

23 years, as determined by the Secretary.
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1 SEC. 6. ASSESSMENTS.

2 (a) AMOUNT.—The Council shall set the initial as3 sessment at no greater than one tenth of 1 cent per gallon

4 of odorized propane. Thereafter, annual assessments shall

5 be sufficient to cover the costs of the plans and programs

6 developed by the Council. The assessment shall not be

7 greater than one-half cent per gallon of odorized propane,

8 unless approved by a majority of those voting in a referen9 dum in both the producer and the retail marketer class.

10 The assessment may not be raised by more than one tenth

11 of 1 cent per gallon of odorized propane annually.

12 (b) OWNERSHIP.—The owner of odorized propane at

13 the time of odorization, or the time of import of odorized

14 propane, shall pay the assessment based on the volume

15 of odorized propane sold and placed into commerce. As16 sessments are payable to the Council on a monthly basis

17 by the 25th of the month following the month of such sale.

18 Propane exported from the United States to another coun19 try is not subject to the assessment.

20 (c) ALTERNATIVE COLLECTION RULES.—The Sec21 retary may by regulation, with the concurrence of the

22 Council, establish an alternative means of collecting the

23 assessment if another means is found to be more efficient

24 and effective. The Secretary may by regulation establish

25 a late payment charge and rate of interest to be imposed
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1 on any person who fails to remit, collect, or pay to the

2 Council any amount due under this Act.

3 (d) INVESTMENT OF FUNDS.—Pending disbursement

4 pursuant to a program, plan, or project, the Council may

5 invest funds collected through assessments, and any other

6 funds received by the Council, only in obligations of the

7 United States or any agency thereof, in general obligations

8 of any State or any political subdivision thereof, in any

9 interest-bearing account or certificate of deposit of a bank

10 that is a member of the Federal Reserve System, or in

11 obligations fully guaranteed as to principal and interest

12 by the United States.

13 (e) STATE PROGRAMS.—After consultation with the

14 Council, the Secretary may by regulation establish a pro15 gram coordinating the operation of the Council with those

16 of any State propane education and research council or

17 similar entity created by State law. This may include a

18 joint or coordinated assessment collection process, a re19 duced assessment, or an assessment rebate. If adopted,

20 the reduction in assessment or rebate may be in an

21 amount not to exceed 20 percent of the regular assessment

22 collected in that State under this section. Assessment re23 bates shall be paid only to a State propane education and

24 research council or similar entity that meets the require-
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1 ments established by the Council, and only for specific

2 projects approved by the Council.

3 SEC. 7. ENFORCEMENT.

4 (a) CEASE AND DESIST ORDERS; CIVIL PEN5 ALTIES.—The Secretary, after providing notice and an op6 portunity for hearing, may, with respect to any person who

7 violates any provision of this Act or any plan, regulation,

8 or order issued under this Act—

9 (1) issue an order requiring that person to

10 cease and desist from continuing such violation; and

11 (2) assess a civil penalty not to exceed $5,000

12 for each such violation.

13 Each day during which a violation continues shall be con14 sidered a separate violation.

15 (b) INVESTIGATORY POWERS.—In order to carry out

16 this Act, the Secretary may administer oaths and affirma17 tions, subpoena witnesses, compel their attendance, take

18 evidence, and require the production of any books, papers,

19 and documents which are relevant to the inquiry. Such

20 attendance of witnesses and the production of any such

21 records may be required from any place in the United

22 States. The district courts of the United States may pun23 ish a failure to comply with a subpoena issued under this

24 subsection as a contempt of the court.
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1 SEC. 8. LOBBYING RESTRICTIONS.

2 No funds collected by the Council shall be used in

3 any manner for influencing legislation or elections, except

4 that the Council may recommend to the Secretary changes

5 in this Act or other statutes that would further the pur6 poses of this Act.

7 SEC. 9. ADMINISTRATIVE PROVISIONS.

8 Nothing in this Act may be construed to preempt or

9 supersede any other program relating to propane edu10 cation and research organized and operated under the laws

11 of the United States or any State.

12 SEC. 10. ISSUANCE OF REGULATIONS.

13 Within 9 months after the date of enactment of this

14 Act, the Secretary shall issue regulations for the imple15 mentation of this Act. The Secretary may require such

16 reports or documentation as is necessary to document the

17 referendum process and the nomination process for mem18 bers of the Council and shall protect the confidentiality

19 of all such documentation provided by industry members.

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