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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 1408 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                S. 1408

  To amend the Internal Revenue Code of 1986 to encourage alternative 
                  energy investments and job creation.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              July 8, 2009

  Mr. Menendez (for himself, Mr. Reid, and Mr. Hatch) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL

 
  To amend the Internal Revenue Code of 1986 to encourage alternative 
                  energy investments and job creation.

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

SECTION 1. SHORT TITLE, ETC.

    (a) Short Title.--This Act may be cited as the ``New Alternative 
Transportation to Give Americans Solutions''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title, etc.
TITLE I--PROMOTE THE PURCHASE AND USE OF NGVS WITH AN EMPHASIS ON HEAVY 
                    DUTY VEHICLES AND FLEET VEHICLES

Sec. 101. Modification of alternative fuel credit.
Sec. 102. Extension and modification of new qualified alternative fuel 
                            motor vehicle credit.
Sec. 103. Allowance of vehicle and infrastructure credits against 
                            regular and minimum tax and transferability 
                            of credits.
Sec. 104. Natural gas vehicle bonds.
Sec. 105. Modification of credit for purchase of vehicles fueled by 
                            compressed natural gas or liquified natural 
                            gas.
Sec. 106. Modification of definition of new qualified alternative fuel 
                            motor vehicle.
      TITLE II--PROMOTE PRODUCTION OF NGVS BY ORIGINAL EQUIPMENT 
                             MANUFACTURERS

Sec. 201. Incentives for manufacturing facilities producing vehicles 
                            fueled by compressed or liquified natural 
                            gas.
 TITLE III--INCENTIVIZE THE INSTALLATION OF NATURAL GAS FUEL PUMPS AT 
SERVICE STATIONS AND DEPOTS AND DOMESTIC LNG PRODUCTION FACILITIES FOR 
                         SMALL ENERGY PRODUCERS

Sec. 301. Extension and modification of alternative fuel vehicle 
                            refueling property credit.
Sec. 302. Increase in credit for certain alternative fuel vehicle 
                            refueling properties.
                     TITLE IV--NATURAL GAS VEHICLES

Sec. 401. Natural gas vehicles in Federal fleet.
Sec. 402. Grants for natural gas vehicles research and development.
Sec. 403. Sense of the Senate on EPA certification of NGV retrofit 
                            kits.

TITLE I--PROMOTE THE PURCHASE AND USE OF NGVS WITH AN EMPHASIS ON HEAVY 
                    DUTY VEHICLES AND FLEET VEHICLES

SEC. 101. MODIFICATION OF ALTERNATIVE FUEL CREDIT.

    (a) Alternative Fuel Credit.--Paragraph (5) of section 6426(d) 
(relating to alternative fuel credit) is amended by inserting ``, and 
December 31, 2019, in the case of any sale or use involving compressed 
or liquefied natural gas)'' after ``hydrogen''.
    (b) Alternative Fuel Mixture Credit.--Paragraph (3) of section 
6426(d) is amended by inserting ``, and December 31, 2019, in the case 
of any sale or use involving compressed or liquefied natural gas)'' 
after ``hydrogen''.
    (c) Payments Relating to Alternative Fuel or Alternative Fuel 
Mixtures.--Paragraph (6) of section 6427(e) is amended--
            (1) in subparagraph (C)--
                    (A) by striking ``subparagraph (D)'' in 
                subparagraph (C) and inserting ``subparagraphs (D) and 
                (E)'', and
                    (B) by striking ``and'' at the end thereof,
            (2) by striking the period at the end of subparagraph (D) 
        and inserting ``, and'', and
            (3) by inserting at the end the following:
                    ``(E) any alternative fuel or alternative fuel 
                mixture (as so defined) involving compressed or 
                liquefied natural gas sold or used after December 31, 
                2019.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to fuel sold or used after the date of the enactment of this Act.

SEC. 102. EXTENSION AND MODIFICATION OF NEW QUALIFIED ALTERNATIVE FUEL 
              MOTOR VEHICLE CREDIT.

    (a) In General.--Paragraph (4) of section 30B(k) (relating to 
termination) is amended by inserting ``(December 31, 2019, in the case 
of a vehicle powered by compressed or liquefied natural gas)'' before 
the period at the end.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 103. ALLOWANCE OF VEHICLE AND INFRASTRUCTURE CREDITS AGAINST 
              REGULAR AND MINIMUM TAX AND TRANSFERABILITY OF CREDITS.

    (a) Business Credits.--Subparagraph (B) of section 38(c)(4) is 
amended by striking ``and'' at the end of clause (vii), by striking the 
period at the end of clause (viii) and inserting ``, and'', and by 
inserting after clause (viii) the following new clauses:
                            ``(ix) the portion of the credit determined 
                        under section 30B which is attributable to the 
                        application of subsection (e)(3) thereof with 
                        respect to new qualified alternative fuel motor 
                        vehicles which are capable of being powered by 
                        compressed or liquefied natural gas, and
                            ``(x) the portion of the credit determined 
                        under section 30C which is attributable to the 
                        application of subsection (b) thereof with 
                        respect to refueling property which is used to 
                        store and or dispense compressed or liquefied 
                        natural gas.''.
    (b) Personal Credits.--
            (1) New qualified alternative fuel motor vehicles.--
        Subsection (g) of section 30B is amended by adding at the end 
        the following new paragraph:
            ``(3) Special rule relating to certain new qualified 
        alternative fuel motor vehicles.--In the case of the portion of 
        the credit determined under subsection (a) which is 
        attributable to the application of subsection (e)(3) with 
        respect to new qualified alternative fuel motor vehicles which 
        are capable of being powered by compressed or liquefied natural 
        gas--
                    ``(A) paragraph (2) shall (after the application of 
                paragraph (1)) be applied separately with respect to 
                such portion, and
                    ``(B) in lieu of the limitation determined under 
                paragraph (2), such limitation shall not exceed the 
                excess (if any) of--
                            ``(i) the sum of the regular tax liability 
                        (as defined in section 26(b)) plus the 
                        tentative minimum tax for the taxable year, 
                        reduced by
                            ``(ii) the sum of the credits allowable 
                        under subpart A and sections 27 and 30.''.
            (2) Alternative fuel vehicle refueling properties.--
        Subsection (d) of section 30C is amended by adding at the end 
        the following new paragraph:
            ``(3) Special rule relating to certain alternative fuel 
        vehicle refueling properties.--In the case of the portion of 
        the credit determined under subsection (a) with respect to 
        refueling property which is used to store and or dispense 
        compressed or liquefied natural gas and which is attributable 
        to the application of subsection (b)--
                    ``(A) paragraph (2) shall (after the application of 
                paragraph (1)) be applied separately with respect to 
                such portion, and
                    ``(B) in lieu of the limitation determined under 
                paragraph (2), such limitation shall not exceed the 
                excess (if any) of--
                            ``(i) the sum of the regular tax liability 
                        (as defined in section 26(b)) plus the 
                        tentative minimum tax for the taxable year, 
                        reduced by
                            ``(ii) the sum of the credits allowable 
                        under subpart A and sections 27, 30, and the 
                        portion of the credit determined under section 
                        30B which is attributable to the application of 
                        subsection (e)(3) thereof.''.
    (c) Credits May Be Transferred.--
            (1) Vehicle credits.--Subsection (h) of section 30B is 
        amended by adding at the end the following new paragraph:
            ``(11) Transferability of credit.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), a taxpayer who places in service any 
                new qualified alternative fuel motor vehicle which is 
                capable of being powered by compressed or liquefied 
                natural gas may transfer the credit allowed under this 
                section by reason of subsection (e) with respect to 
                such vehicle through an assignment to the seller or 
                lessor of such vehicle. Such transfer may be revoked 
                only with the consent of the Secretary.
                    ``(B) Denial of double benefit.--No assignment of a 
                credit allowed under this section by reason of 
                subsection (e) with respect to any new qualified 
                alternative fuel motor vehicle which is capable of 
                being powered by compressed or liquefied natural gas 
                may be made under subparagraph (A) to a taxpayer who 
                has claimed a credit under section 54G with respect to 
                the financing of such vehicle.
                    ``(C) Regulations.--The Secretary shall prescribe 
                such regulations as necessary to ensure that any credit 
                transferred under subparagraph (A) is claimed once and 
                not reassigned by such other person.''.
            (2) Infrastructure credit.--Subsection (e) of section 30C 
        is amended by adding at the end the following new paragraph:
            ``(7) Transferability of credit.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), a taxpayer who places in service any 
                qualified alternative fuel vehicle refueling property 
                relating to compressed or liquefied natural gas may 
                transfer the credit allowed under this section with 
                respect to such property through an assignment to the 
                seller or lessor of such property. Such transfer may be 
                revoked only with the consent of the Secretary.
                    ``(B) Denial of double benefit.--No assignment of a 
                credit allowed under this section by reason of 
                subsection (e) with respect to any qualified 
                alternative fuel vehicle refueling property relating to 
                compressed or liquefied natural gas may be made under 
                subparagraph (A) to a taxpayer who has claimed a credit 
                under section 54G with respect to the financing of such 
                property.
                    ``(C) Regulations.--The Secretary shall prescribe 
                such regulations as necessary to ensure that any credit 
                transferred under subparagraph (A) is claimed once and 
                not reassigned by such other person.''.
    (d) Effective Date.--The amendments made by this section shall 
apply with respect to property placed in service after the date of the 
enactment of this Act.

SEC. 104. NATURAL GAS VEHICLE BONDS.

    (a) In General.--Subpart I of part IV of subchapter A of chapter 1 
(relating to qualified tax credit bonds) is amended by adding at the 
end the following new section:

``SEC. 54G. NATURAL GAS VEHICLE BONDS.

    ``(a) Natural Gas Vehicle Bond.--For purposes of this subpart, the 
term `natural gas vehicle bond' means any bond issued as part of an 
issue if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for capital expenditures incurred by a 
        governmental body for 1 or more qualified natural gas vehicle 
        projects placed in service by such governmental body primarily 
        for governmental or public use,
            ``(2) the bond is issued by a governmental body,
            ``(3) the issuer designates such bond for purposes of this 
        section, and
            ``(4) in lieu of the requirements of section 54A(d)(2), the 
        issue meets the requirements of subsection (c).
    ``(b) Limitation on Amount of Bonds Designated.--
            ``(1) In general.--The maximum aggregate face amount of 
        bonds which may be designated under subsection (a) by any 
        issuer shall not exceed the limitation amount allocated under 
        this subsection to such issuer.
            ``(2) National limitation on amount of bonds designated.--
        There is a national natural gas vehicle bond limitation of 
        $3,000,000,000.
            ``(3) Allocation by secretary.--The Secretary shall 
        allocate the amount described in paragraph (2) among qualified 
        natural gas vehicle projects in such manner as the Secretary 
        determines appropriate.
    ``(c) Special Rules Relating to Expenditures.--
            ``(1) In general.--An issue shall be treated as meeting the 
        requirements of this subsection if, as of the date of issuance, 
        the issuer reasonably expects--
                    ``(A) 100 percent or more of the available project 
                proceeds of such issue are to be spent for 1 or more 
                qualified natural gas vehicle projects within the 5-
                year period beginning on the date of issuance of the 
                natural gas vehicle bond,
                    ``(B) a binding commitment with a third party to 
                spend at least 10 percent of such available project 
                proceeds will be incurred within the 6-month period 
                beginning on the date of issuance of the natural gas 
                vehicle bond, and
                    ``(C) such projects will be completed with due 
                diligence and such available project proceeds will be 
                spent with due diligence.
            ``(2) Extension of period.--Upon submission of a request 
        prior to the expiration of the period described in paragraph 
        (1)(A), the Secretary may extend such period if the issuer 
        establishes that the failure to satisfy the 5-year requirement 
        is due to reasonable cause and the related projects will 
        continue to proceed with due diligence.
            ``(3) Failure to spend required amount of bond proceeds 
        within 5 years.--To the extent that less than 100 percent of 
        the available project proceeds of such issue are expended by 
        the close of the 5-year period beginning on the date of 
        issuance (or if an extension has been obtained under paragraph 
        (2), by the close of the extended period), the issuer shall 
        redeem all of the nonqualified bonds within 90 days after the 
        end of such period. For purposes of this paragraph, the amount 
        of the nonqualified bonds required to be redeemed shall be 
        determined in the same manner as under section 142.
    ``(d) Governmental Body.--For purposes of this section, the term 
`governmental body' means any State or Indian tribal government, or any 
political subdivision thereof.
    ``(e) Qualified Natural Gas Vehicle Project.--For purposes of this 
subpart, the term `qualified natural gas vehicle project' means--
            ``(1) 1 or more new qualified alternative fuel motor 
        vehicles which are capable of being powered by compressed or 
        liquefied natural gas (within the meaning of section 
        30B(e)(4)), or
            ``(2) 1 or more qualified alternative fuel vehicle 
        refueling properties which are used to store and or dispense 
        compressed or liquefied natural gas (within the meaning of 
        section 30C(c)).
    ``(f) Termination.--This section shall not apply with respect to 
any bond issued after December 31, 2019.''.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d) is amended by striking 
        ``or'' at the end of subparagraph (D), by inserting ``or'' at 
        the end of subparagraph (E), and by inserting after 
        subparagraph (E) the following new subparagraph:
                    ``(F) a natural gas vehicle bond,''.
            (2) Subparagraph (C) of section 54A(d)(2) is amended by 
        striking ``and'' at the end of clause (iv), by striking the 
        period at the end of clause (v) and inserting ``, and'', and by 
        adding at the end the following new clause:
                            ``(vi) in the case of a natural gas vehicle 
                        bond, a purpose specified in section 
                        54G(a)(1).''.
    (c) Clerical Amendment.--The table of sections for subpart I of 
part IV of subchapter A of chapter 1 is amended by adding at the end 
the following new item:

``Sec. 54G. Natural gas vehicle bonds.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to bonds issued after the date of the enactment of this Act.

SEC. 105. MODIFICATION OF CREDIT FOR PURCHASE OF VEHICLES FUELED BY 
              COMPRESSED NATURAL GAS OR LIQUIFIED NATURAL GAS.

    (a) Increase in Credit.--Paragraph (2) of section 30B(e) (relating 
to applicable percentage) is amended to read as follows:
            ``(2) Applicable percentage.--For purposes of paragraph 
        (1), the applicable percentage with respect to any new 
        qualified alternative fuel motor vehicle is--
                    ``(A) except as provided in subparagraphs (B) and 
                (C)--
                            ``(i) 50 percent, plus
                            ``(ii) 30 percent, if such vehicle--
                                    ``(I) has received a certificate of 
                                conformity under the Clean Air Act and 
                                meets or exceeds the most stringent 
                                standard available for certification 
                                under the Clean Air Act for that make 
                                and model year vehicle (other than a 
                                zero emission standard), or
                                    ``(II) has received an order 
                                certifying the vehicle as meeting the 
                                same requirements as vehicles which may 
                                be sold or leased in California and 
                                meets or exceeds the most stringent 
                                standard available for certification 
                                under the State laws of California 
                                (enacted in accordance with a waiver 
                                granted under section 209(b) of the 
                                Clean Air Act) for that make and model 
                                year vehicle (other than a zero 
                                emission standard),
                    ``(B) 80 percent, in the case of vehicles that are 
                only capable of operating on compressed natural gas or 
                liquefied natural gas, or mix-fuel vehicles which are 
                capable of operating on compressed or liquefied natural 
                gas, and
                    ``(C) 50 percent, in the case of vehicles described 
                subsection (e)(4)(A)(i)(II).
        For purposes of the preceding sentence, in the case of any new 
        qualified alternative fuel motor vehicle which weighs more than 
        14,000 pounds gross vehicle weight rating, the most stringent 
        standard available shall be such standard available for 
        certification on the date of the enactment of the Energy Tax 
        Incentives Act of 2005.''.
    (b) Higher Incremental Cost Limits for Natural Gas Vehicles.--
Subsection (e) of section 30B (relating to new qualified alternative 
fuel motor vehicle credit) is amended by adding at the end the 
following new paragraph:
            ``(6) Higher incremental cost limits for natural gas 
        vehicles.--In the case of new qualified alternative fuel motor 
        vehicles with respect to vehicles powered by compressed or 
        liquefied natural gas, paragraph (3) shall be applied--
                    ``(A) in subparagraph (A) by substituting `$12,500' 
                for `$5,000',
                    ``(B) in subparagraph (B) by substituting `$20,000' 
                for `$10,000',
                    ``(C) in subparagraph (C) by substituting `$50,000' 
                for `$25,000', and
                    ``(D) in subparagraph (D) by substituting `$80,000' 
                for `$40,000'.''.
    (c) Effective Date.--The amendment made by this section shall apply 
to property placed in service after the date of the enactment of this 
Act.

SEC. 106. MODIFICATION OF DEFINITION OF NEW QUALIFIED ALTERNATIVE FUEL 
              MOTOR VEHICLE.

    (a) In General.--Clause (i) of section 30B(e)(4)(A) (relating to 
definition of new qualified alternative fuel motor vehicle) is amended 
to read as follows:
                            ``(i) which--
                                    ``(I) is only capable of operating 
                                on an alternative fuel, or
                                    ``(II) is capable of operating on 
                                compressed or liquefied natural gas and 
                                gasoline or diesel fuel, but in no case 
                                shall such vehicle have an operating 
                                range of less than 200 miles on 
                                compressed or liquefied natural gas.''.
    (b) Conversions and Repowers.--Paragraph (4) of section 30B(e) is 
amended by adding at the end the following new subparagraph:
                    ``(C) Conversions and repowers.--
                            ``(i) In general.--The term `new qualified 
                        alternative fuel motor vehicle' includes the 
                        conversion or repower of a new or used vehicle 
                        so that it is capable of operating on an 
                        alternative fuel as it was not previously 
                        capable of operating on an alternative fuel.
                            ``(ii) Treatment as new.--A vehicle which 
                        has been converted to operate on an alternative 
                        fuel shall be treated as new on the date of 
                        such conversion for purposes of this section.
                            ``(iii) Rule of construction.--In the case 
                        of a used vehicle which is converted or 
                        repowered, nothing in this section shall be 
                        construed to require that the motor vehicle be 
                        acquired in the year the credit is claimed 
                        under this section with respect to such 
                        vehicle.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

      TITLE II--PROMOTE PRODUCTION OF NGVS BY ORIGINAL EQUIPMENT 
                             MANUFACTURERS

SEC. 201. INCENTIVES FOR MANUFACTURING FACILITIES PRODUCING VEHICLES 
              FUELED BY COMPRESSED OR LIQUIFIED NATURAL GAS.

    (a) Deduction for Manufacturing Facilities.--Part VI of subchapter 
B of chapter 1 of the Internal Revenue Code of 1986 (relating to 
itemized deductions for individuals and corporations) is amended by 
inserting after section 179E the following new section:

``SEC. 179F. EXPENSING FOR MANUFACTURING FACILITIES PRODUCING VEHICLES 
              FUELED BY COMPRESSED NATURAL GAS OR LIQUIFIED NATURAL 
              GAS.

    ``(a) Treatment as Expenses.--A taxpayer may elect to treat the 
applicable percentage of the cost of any qualified natural gas vehicle 
manufacturing facility property as an expense which is not chargeable 
to a capital account. Any cost so treated shall be allowed as a 
deduction for the taxable year in which the qualified manufacturing 
facility property is placed in service.
    ``(b) Applicable Percentage.--For purposes of subsection (a), the 
applicable percentage is--
            ``(1) 100 percent, in the case of qualified natural gas 
        vehicle manufacturing facility property which is placed in 
        service before January 1, 2015, and
            ``(2) 50 percent, in the case of qualified natural gas 
        vehicle manufacturing facility property which is placed in 
        service after December 31, 2014, and before January 1, 2020.
    ``(c) Election.--
            ``(1) In general.--An election under this section for any 
        taxable year shall be made on the taxpayer's return of the tax 
        imposed by this chapter for the taxable year. Such election 
        shall be made in such manner as the Secretary may by 
        regulations prescribe.
            ``(2) Election irrevocable.--Any election made under this 
        section may not be revoked except with the consent of the 
        Secretary.
    ``(d) Qualified Natural Gas Vehicle Manufacturing Facility 
Property.--For purposes of this section--
            ``(1) In general.--The term `qualified natural gas vehicle 
        manufacturing facility property' means any qualified property--
                    ``(A) the original use of which commences with the 
                taxpayer,
                    ``(B) which is placed in service by the taxpayer 
                after the date of the enactment of this section and 
                before January 1, 2020, and
                    ``(C) no written binding contract for the 
                construction of which was in effect on or before the 
                date of the enactment of this section.
            ``(2) Qualified property.--
                    ``(A) In general.--The term `qualified property' 
                means any property which is a facility or a portion of 
                a facility used for the production of--
                            ``(i) any new qualified alternative fuel 
                        motor vehicle which is capable of being powered 
                        by compressed or liquefied natural gas (within 
                        the meaning of section 30B(e)(4)), or
                            ``(ii) any eligible component.
                    ``(B) Eligible component.--The term `eligible 
                component' means any component which is designed 
                specifically for use in such a new qualified 
                alternative fuel motor vehicle.
    ``(e) Special Rule for Dual Use Property.--
            ``(1) In general.--In the case of any qualified natural gas 
        vehicle manufacturing facility property which is used to 
        produce both property described in clauses (i) and (ii) of 
        subsection (d)(2)(A) and property which is not so described, 
        the amount of costs taken into account under subsection (a) 
        shall be reduced by an amount equal to--
                    ``(A) the total amount of such costs (determined 
                before the application of this subsection), multiplied 
                by
                    ``(B) the percentage of property expected to be 
                produced which is not so described.
            ``(2) Regulations.--The Secretary shall prescribe such 
        regulations as are necessary to carry out the purpose of this 
        subsection.''.
    (b) Refund of Credit for Prior Year Minimum Tax Liability.--Section 
53 (relating to credit for prior year minimum tax liability) is amended 
by adding at the end the following new subsection:
    ``(g) Election To Treat Amounts Attributable to Qualified 
Manufacturing Facility.--
            ``(1) In general.--In the case of an eligible taxpayer, the 
        amount determined under subsection (c) for the taxable year 
        (after the application of subsection (e)) shall be increased by 
        an amount equal to the applicable percentage of any qualified 
        natural gas vehicle manufacturing facility property which is 
        placed in service during the taxable year.
            ``(2) Applicable percentage.--For purposes of paragraph 
        (1), the applicable percentage is--
                    ``(A) 35 percent, in the case of qualified natural 
                gas vehicle manufacturing facility property which is 
                placed in service before January 1, 2015, and
                    ``(B) 17.5 percent, in the case of qualified 
                natural gas vehicle manufacturing facility property 
                which is placed in service after December 31, 2014, and 
                before January 1, 2020.
            ``(3) Eligible taxpayer.--For purposes of this subsection, 
        the term `eligible taxpayer' means any taxpayer--
                    ``(A) who places in service qualified natural gas 
                vehicle manufacturing facility property during the 
                taxable year,
                    ``(B) who does not make an election under section 
                179F(c), and
                    ``(C) who makes an election under this subsection.
            ``(4) Other definitions and special rules.--
                    ``(A) Qualified natural gas vehicle manufacturing 
                facility property.--The term `qualified natural gas 
                vehicle manufacturing facility property' has the 
                meaning given such term under section 179F(d).
                    ``(B) Special rule for dual use property.--In the 
                case of any qualified natural gas vehicle manufacturing 
                facility property which is used to produce both 
                qualified property (as defined in section 179F(d)) and 
                other property which is not qualified property, the 
                amount of costs taken into account under paragraph (1) 
                shall be reduced by an amount equal to--
                            ``(i) the total amount of such costs 
                        (determined before the application of this 
                        subparagraph), multiplied by
                            ``(ii) the percentage of property expected 
                        to be produced which is not qualified property.
                    ``(C) Election.--
                            ``(i) In general.--An election under this 
                        subsection for any taxable year shall be made 
                        on the taxpayer's return of the tax imposed by 
                        this chapter for the taxable year. Such 
                        election shall be made in such manner as the 
                        Secretary may by regulations prescribe.
                            ``(ii) Election irrevocable.--Any election 
                        made under this subsection may not be revoked 
                        except with the consent of the Secretary.
            ``(5) Credit refundable.--For purposes of this title (other 
        than this section), the credit allowed by reason of this 
        subsection shall be treated as if it were allowed under subpart 
        C.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

 TITLE III--INCENTIVIZE THE INSTALLATION OF NATURAL GAS FUEL PUMPS AT 
SERVICE STATIONS AND DEPOTS AND DOMESTIC LNG PRODUCTION FACILITIES FOR 
                         SMALL ENERGY PRODUCERS

SEC. 301. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL VEHICLE 
              REFUELING PROPERTY CREDIT.

    (a) In General.--Subsection (g) of section 30C is amended by 
striking ``and'' at the end of paragraph (1), by redesignating 
paragraph (2) as paragraph (3), and by inserting after paragraph (1) 
the following new paragraph:
            ``(2) in the case of property relating to compressed or 
        liquefied natural gas, after December 31, 2019, and''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 302. INCREASE IN CREDIT FOR CERTAIN ALTERNATIVE FUEL VEHICLE 
              REFUELING PROPERTIES.

    (a) In General.--Subsection (b) of section 30C is amended to read 
as follows:
    ``(b) Limitation.--The credit allowed under subsection (a) with 
respect to all qualified alternative fuel vehicle refueling property 
placed in service by the taxpayer during the taxable year at a location 
shall not exceed--
            ``(1) except as provided in paragraph (2), $30,000 in the 
        case of a property of a character subject to an allowance for 
        depreciation,
            ``(2) in the case of a compressed natural gas, or liquefied 
        natural gas, the lesser of--
                    ``(A) 50 percent of such cost, or
                    ``(B) $100,000, and
            ``(3) $2,000 in any other case.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to property placed in service in taxable years beginning after December 
31, 2010.

                     TITLE IV--NATURAL GAS VEHICLES

SEC. 401. NATURAL GAS VEHICLES IN FEDERAL FLEET.

    When complying with mandatory Federal fleet alternative fuel 
vehicle purchase requirements, Federal agencies shall purchase 
dedicated alternative fuel vehicles unless the agency can show that 
alternative fuel is unavailable or purchasing such vehicles would be 
impractical.

SEC. 402. GRANTS FOR NATURAL GAS VEHICLES RESEARCH AND DEVELOPMENT.

    (a) In General.--The Secretary of Energy may make grants to 
original equipment manufacturers of light duty and heavy duty natural 
gas vehicles for the development of engines that reduce emissions, 
improve performance and efficiency, and lower cost.
    (b) Limitation.--The aggregate amount of grants under subsection 
(a) for any fiscal year shall not exceed $30,000,000.

SEC. 403. SENSE OF THE SENATE ON EPA CERTIFICATION OF NGV RETROFIT 
              KITS.

    It is the sense of the Senate that the Environmental Protection 
Agency should streamline the process for certification of natural gas 
vehicle retrofit kits to promote energy security while still fulfilling 
the mission of the Clean Air Act.
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