I 

112TH CONGRESS 

1ST SESSION H. R. 2231 

To amend the Internal Revenue Code of 1986 to terminate the ethanol 

tax credits, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 16, 2011 

Mrs. NOEM (for herself, Mr. BERG, and Mr. SCHOCK) introduced the following 

bill; which was referred to the Committee on Ways and Means, and in 

addition to the Committee on the Budget, for a period to be subsequently 

determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Internal Revenue Code of 1986 to terminate 

the ethanol tax credits, 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 ‘‘Ethanol Modernization 

5 and Deficit Reduction Act’’. 

6 SEC. 2. TERMINATION OF ETHANOL TAX CREDITS. 

7 (a) EXCISE TAX CREDIT AND DIRECT PAYMENTS.— 

8 Sections 6426(b)(6) and 6427(e)(6)(A) of the Internal 


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1 Revenue Code of 1986 are each amended by striking ‘‘De2 cember 31, 2011’’ and inserting ‘‘June 30, 2011’’. 

3 (b) INCOME TAX CREDIT.—Paragraph (1) of section 

4 40(e) of such Code is amended— 

5 (1) by striking ‘‘December 31, 2011’’ in sub6 paragraph (A) and inserting ‘‘June 30, 2011’’, and 

7 (2) by striking ‘‘January 1, 2012’’ in subpara8 graph (B) and inserting ‘‘July 1, 2011’’. 

9 (c) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply to any sale, use, or removal for 

11 any period after June 30, 2011. 

12 SEC. 3. EXTENSION AND MODIFICATION OF ALTERNATIVE 

13 FUEL VEHICLE REFUELING PROPERTY CRED14 IT. 

15 (a) EXTENSION.—Subsection (g) of section 30C of 

16 the Internal Revenue Code of 1986 is amended by striking 

17 ‘‘placed in service—’’ and all that follows and inserting 

18 ‘‘placed in service after the earlier of December 31, 2016, 

19 or the date on which the Secretary certifies that at least 

20 53,000 qualified alternative fuel refueling properties 

21 (other than properties described in subsection (c)(2)(C)) 

22 have been placed in service.’’. 

23 (b) ONLY CERTAIN ETHANOL BLENDS ELIGIBLE

24 FOR CREDIT.—Subparagraph (A) of section 30C(c)(2) of 


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1 the Internal Revenue Code of 1986 is amended to read 

2 as follows: 

3 ‘‘(A) Any fuel— 

4 ‘‘(i) at least 85 percent of the volume 

5 of which consists of one or more of the fol6 lowing: natural gas, compressed natural 

7 gas, liquified natural gas, liquefied petro8 leum gas, or hydrogen, or 

9 ‘‘(ii) at least 85 percent of the volume 

10 of which consists of— 

11 ‘‘(I) ethanol, or 

12 ‘‘(II) ethanol and gasoline or one 

13 or more of the fuels described in 

14 clause (i), but only if at least 15 per15 cent and not more than 85 percent of 

16 the volume of such fuel consists of 

17 ethanol.’’. 

18 (c) CREDIT FOR DUAL-USE REFUELING PROP19 ERTY.—Subsection (e) of section 30C of the Internal Rev20 enue Code of 1986 is amended by adding at the end the 

21 following new paragraph: 

22 ‘‘(6) DUAL-USE REFUELING PROPERTY.— 

23 ‘‘(A) IN GENERAL.—In the case of any 

24 dual-use refueling property, 100 percent of the 

25 cost of such property shall be treated as qualiVerDate Mar 15 2010 03:14 Jun 21, 2011 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2231.IH H2231

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1 fied alternative fuel refueling property if the 

2 taxpayer certifies, in such time and manner as 

3 the Secretary shall prescribe, that such prop4 erty will be used in more than a de minimis ca5 pacity for the purposes described in section 

6 179A(d)(3)(A) (applied as specified in sub7 section (c)(2)). 

8 ‘‘(B) RECAPTURE.—If at any time within 

9 5 years after the date of the certification under 

10 subparagraph (A) the dual-use refueling prop11 erty ceases to be used as required under such 

12 subparagraph, 100 percent of the cost of such 

13 property shall be subject to recapture under 

14 paragraph (5). 

15 ‘‘(C) DUAL-USE REFUELING PROPERTY.— 

16 For purposes of this paragraph, the term ‘dual17 use refueling property’ means property that is 

18 both qualified alternative fuel vehicle refueling 

19 property and property used— 

20 ‘‘(i) to store or dispense fuels not de21 scribed in subsection (c)(2), or 

22 ‘‘(ii) to store fuels described in sub23 section (c)(2) for any purpose other than 

24 delivery of such fuel into the fuel tank of 

25 a motor vehicle.’’. 


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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to property placed in service after 

3 June 30, 2011. 

4 SEC. 4. EXTENSION OF CELLULOSIC BIOFUEL PRODUCER 

5 CREDIT THROUGH 2014. 

6 Subparagraph (H) of section 40(b)(6) of the Internal 

7 Revenue Code of 1986 is amended by striking ‘‘January 

8 1, 2013’’ and inserting ‘‘January 1, 2015’’. 

9 SEC. 5. EXTENSION OF SPECIAL DEPRECIATION ALLOW10 ANCE FOR CELLULOSIC BIOFUEL PLANT 

11 PROPERTY. 

12 Subparagraph (D) of section 168(l)(2) of the Internal 

13 Revenue Code of 1986 is amended by striking ‘‘January 

14 1, 2013’’ and inserting ‘‘January 1, 2015’’. 

15 SEC. 6. ALGAE TREATED AS A QUALIFIED FEEDSTOCK FOR 

16 PURPOSES OF THE CELLULOSIC BIOFUEL 

17 PRODUCER CREDIT, ETC. 

18 (a) IN GENERAL.—Subclause (I) of section 

19 40(b)(6)(E)(i) of the Internal Revenue Code of 1986 is 

20 amended to read as follows: 

21 ‘‘(I) is derived solely by, or from, 

22 qualified feedstocks, and’’. 

23 (b) QUALIFIED FEEDSTOCK; SPECIAL RULES FOR

24 ALGAE.—Paragraph (6) of section 40(b) of the Internal 

25 Revenue Code of 1986, as amended by this Act, is amendVerDate Mar 15 2010 03:14 Jun 21, 2011 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2231.IH H2231

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1 ed by redesignating subparagraphs (F) and (G) as sub2 paragraphs (H) and (I), respectively, and by inserting 

3 after subparagraph (E) the following new subparagraphs: 

4 ‘‘(F) QUALIFIED FEEDSTOCK.—For pur5 poses of this paragraph, the term ‘qualified 

6 feedstock’ means— 

7 ‘‘(i) any lignocellulosic or 

8 hemicellulosic matter that is available on a 

9 renewable or recurring basis, and 

10 ‘‘(ii) any cultivated algae, 

11 cyanobacteria, or lemna. 

12 ‘‘(G) SPECIAL RULES FOR ALGAE.—In the 

13 case of fuel which is derived by, or from, feed14 stock described in subparagraph (F)(ii) and 

15 which is sold by the taxpayer to another person 

16 for refining by such other person into a fuel 

17 which meets the requirements of subparagraph 

18 (E)(i)(II)— 

19 ‘‘(i) such sale shall be treated as de20 scribed in subparagraph (C)(i), 

21 ‘‘(ii) such fuel shall be treated as 

22 meeting the requirements of subparagraph 

23 (E)(i)(II) in the hands of such taxpayer, 

24 and 


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1 ‘‘(iii) except as provided in this sub2 paragraph, such fuel (and any fuel derived 

3 from such fuel) shall not be taken into ac4 count under subparagraph (C) with respect 

5 to the taxpayer or any other person.’’. 

6 (c) ALGAE TREATED AS A QUALIFIED FEEDSTOCK

7 FOR PURPOSES OF BONUS DEPRECIATION FOR BIOFUEL

8 PLANT PROPERTY.— 

9 (1) IN GENERAL.—Subparagraph (A) of section 

10 168(l)(2) of the Internal Revenue Code of 1986 is 

11 amended by striking ‘‘solely to produce cellulosic 

12 biofuel’’ and inserting ‘‘solely to produce second gen13 eration biofuel (as defined in section 40(b)(6)(E))’’. 

14 (2) CONFORMING AMENDMENTS.—Subsection 

15 (l) of section 168 of such Code, as amended by this 

16 Act, is amended— 

17 (A) by striking ‘‘cellulosic biofuel’’ each 

18 place it appears in the text thereof and insert19 ing ‘‘second generation biofuel’’, 

20 (B) by striking paragraph (3) and redesig21 nating paragraphs (4) through (8) as para22 graphs (3) through (7), respectively, 

23 (C) by striking ‘‘CELLULOSIC’’ in the 

24 heading of such subsection and inserting ‘‘SEC25 OND GENERATION’’, and 


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1 (D) by striking ‘‘CELLULOSIC’’ in the head2 ing of paragraph (2) and inserting ‘‘SECOND

3 GENERATION’’. 

4 (d) CONFORMING AMENDMENTS.— 

5 (1) Section 40 of the Internal Revenue Code of 

6 1986, as amended by this Act, is amended— 

7 (A) by striking ‘‘cellulosic biofuel’’ each 

8 place it appears in the text thereof and insert9 ing ‘‘second generation biofuel’’, 

10 (B) by striking ‘‘CELLULOSIC’’ in the 

11 headings of subsections (b)(6), (b)(6)(E), and 

12 (d)(3)(D) and inserting ‘‘SECOND GENERA13 TION’’, and 

14 (C) by striking ‘‘CELLULOSIC’’ in the head15 ings of subsections (b)(6)(C), (b)(6)(D), 

16 (b)(6)(H), (d)(6), and (e)(3) and inserting 

17 ‘‘SECOND GENERATION’’. 

18 (2) Clause (ii) of section 40(b)(6)(E) of such 

19 Code is amended by striking ‘‘Such term shall not’’ 

20 and inserting ‘‘The term ‘second generation biofuel’ 

21 shall not’’. 

22 (3) Paragraph (1) of section 4101(a) of such 

23 Code is amended by striking ‘‘cellulosic biofuel’’ and 

24 inserting ‘‘second generation biofuel’’. 

25 (e) EFFECTIVE DATE.— 


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1 (1) IN GENERAL.—Except as provided in para2 graph (2), the amendments made by this section 

3 shall apply to fuels sold or used after the date of the 

4 enactment of this Act. 

5 (2) APPLICATION TO BONUS DEPRECIATION.— 

6 The amendments made by subsection (c) shall apply 

7 to property placed in service after the date of the en8 actment of this Act. 

9 SEC. 7. BUDGETARY EFFECTS. 

10 (a) PAYGO SCORECARD.—The budgetary effects of 

11 this Act (and the amendments made by this Act) shall not 

12 be entered on either PAYGO scorecard maintained pursu13 ant to section 4(d) of the Statutory Pay-As-You-Go Act 

14 of 2010. 

15 (b) SENATE PAYGO SCORECARD.—The budgetary 

16 effects of this Act (and the amendments made by this Act) 

17 shall not be recorded on any PAYGO scorecard main18 tained for purposes of section 201 of S. Con. Res. 21 

19 (110th Congress). 

Æ 


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