I 

114TH CONGRESS 

1ST SESSION H. R. 3390 

To amend the Internal Revenue Code of 1986 to provide credits for the 

production of renewable chemicals and investments in renewable chemical 

production facilities, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 29, 2015 

Mr. PASCRELL (for himself, Mr. FITZPATRICK, and Mr. NEAL) introduced the 

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

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

credits for the production of renewable chemicals and 

investments in renewable chemical production facilities, 

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 ‘‘Qualifying Renewable 

5 Chemical Production or Investment Tax Credit Act of 

6 2015’’. 


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1 SEC. 2. CREDITS FOR PRODUCTION OF RENEWABLE CHEMI2 CALS AND INVESTMENTS IN RENEWABLE 

3 CHEMICAL PRODUCTION FACILITIES. 

4 (a) PRODUCTION OF RENEWABLE CHEMICALS.— 

5 (1) IN GENERAL.—Subpart D of part IV of 

6 subchapter A of chapter 1 of the Internal Revenue 

7 Code of 1986 is amended by adding at the end the 

8 following new section: 

9 ‘‘SEC. 45S. CREDIT FOR PRODUCTION OF RENEWABLE 

10 CHEMICALS. 

11 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

12 production credit for renewable chemicals for any taxable 

13 year is an amount (determined separately for each renew14 able chemical produced by the taxpayer) equal to $0.15 

15 per pound of biobased content of renewable chemical pro16 duced by the taxpayer during the taxable year. 

17 ‘‘(b) LIMITATION.—The amount of the credit deter18 mined under subsection (a) with respect to a renewable 

19 chemical produced by the taxpayer during any taxable 

20 year shall not exceed the credit amount allocated for pur21 poses of this section by the Secretary to the taxpayer with 

22 respect to such chemical for such taxable year under sec23 tion 48E(e). 

24 ‘‘(c) BIOBASED CONTENT.—For purposes of this sec25 tion, the term ‘biobased content’ means, with respect to 

26 any renewable chemical, the biobased content of the total 


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1 mass of organic carbon in such chemical (expressed as a 

2 percentage), determined by testing representative samples 

3 using the American Society for Testing and Materials 

4 (ASTM) D6866. 

5 ‘‘(d) RENEWABLE CHEMICAL.—For purposes of this 

6 section— 

7 ‘‘(1) IN GENERAL.—The term ‘renewable chem8 ical’ means any chemical which— 

9 ‘‘(A) is produced by the taxpayer in the 

10 United States (or in a territory or possession of 

11 the United States) from renewable biomass. 

12 For purposes of this section, the term ‘renew13 able biomass’ has the meaning given such term 

14 in section 9001(13) of the Farm Security and 

15 Rural Investment Act of 2002 (7 U.S.C. 

16 8101(13)); 

17 ‘‘(B) is sold, or used, by the taxpayer— 

18 ‘‘(i) for the production of chemical 

19 products, polymers, plastics, or formulated 

20 products, or 

21 ‘‘(ii) as chemicals, polymers, plastics, 

22 or formulated products; 

23 ‘‘(C) the biobased content percentage of 

24 which is 95 percent or higher; 


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1 ‘‘(D) is the product of, or reliant upon, bi2 ological conversion, thermal conversion, or a 

3 combination of biological and thermal conver4 sion, of renewable biomass; 

5 ‘‘(E) is not sold or used for the production 

6 of any food, feed, or fuel; 

7 ‘‘(F) is not a combination of renewable 

8 chemicals on the list under subparagraph (G) 

9 (or added to the list under paragraph (2)) for 

10 which a credit has been taken under this sec11 tion or section 48E; and 

12 ‘‘(G) is included on the following list of re13 newable chemicals eligible for credit: acetic acid; 

14 acrylic acid; acyl glutamate; adipic acid; algae 

15 oils; algae sugars; aromatics; 1,4-butanediol 

16 (BDO); iso-butanol; n-butanol; carboxylic acids; 

17 cellulosic sugar; diethyl methylene malonate; 

18 ethyl acetate; farnesene; gamma-butyrolactone; 

19 hexamethylenediamine (HMD); 3-hydroxy pro20 pionic acid; glucaric acid; C10 hydrocarbons; 

21 isoprene; itaconic acid; ketals; levulinic acid; 

22 olefins; polyhydroxyalkonate (PHA); polylactic 

23 acid (PLA); polyitaconic acid; polyols from veg24 etable oils; poly(xylitan levulinate ketal); 1,3- 


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1 propanediol; 1,2-propanediol; succinic acid; 

2 terpenes; thiols; p-xylene. 

3 ‘‘(2) ADDITIONAL RENEWABLE CHEMICALS.— 

4 The Secretary may add chemicals to the list of re5 newable chemicals established in paragraph (1)(G). 

6 Not later than 180 days after the enactment of this 

7 section, the Secretary, in consultation with the Sec8 retary of Agriculture, shall establish a program to 

9 consider applications from taxpayers to add renew10 able chemicals to the list. Any chemical added to the 

11 list must meet the requirements set forth in sub12 paragraphs (A) through (F) of paragraph (1). 

13 ‘‘(e) COORDINATION WITH INVESTMENT CREDIT FOR

14 RENEWABLE CHEMICAL PRODUCTION FACILITIES.—See 

15 section 48E(f) for rules coordinating section 48E with this 

16 section. 

17 ‘‘(f) TERMINATION.—Notwithstanding any other pro18 vision of this section, the Secretary may not allocate any 

19 credit amount under this section to any taxable year which 

20 begins more than 5 years after the date of the enactment 

21 of this section.’’. 

22 (2) CREDIT TO BE PART OF GENERAL BUSI23 NESS CREDIT.—Subsection (b) of section 38 of such 

24 Code is amended by striking ‘‘plus’’ at the end of 

25 paragraph (35), by striking the period at the end of 


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1 paragraph (36) and inserting ‘‘, plus’’, and by add2 ing at the end the following new paragraph: 

3 ‘‘(37) the renewable chemicals production credit 

4 determined under section 45S(a).’’. 

5 (b) INVESTMENT CREDIT IN LIEU OF PRODUCTION

6 CREDIT.— 

7 (1) IN GENERAL.—Section 46 of such Code is 

8 amended by striking ‘‘and’’ at the end of paragraph 

9 (5), by striking the period at the end of paragraph 

10 (6) and inserting ‘‘, and’’, and by adding at the end 

11 the following new paragraph: 

12 ‘‘(6) the renewable chemical production facili13 ties credit.’’. 

14 (2) RENEWABLE CHEMICAL PRODUCTION FA15 CILITIES CREDIT.—Subpart E of part IV of sub16 chapter A of chapter 1 of such Code is amended by 

17 inserting after section 48D the following: 

18 ‘‘SEC. 48E. INVESTMENT CREDIT FOR RENEWABLE CHEM19 ICAL PRODUCTION FACILITIES. 

20 ‘‘(a) IN GENERAL.—For purposes of section 46, the 

21 renewable chemical production facilities credit for any tax22 able year is an amount equal to 30 percent of the basis 

23 of any eligible property which is a part of a renewable 

24 chemical production facility placed in service by the tax25 payer during such taxable year. 


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1 ‘‘(b) LIMITATION.—The amount of the credit deter2 mined under subsection (a) with respect to a renewable 

3 chemical production facility of the taxpayer during any 

4 taxable year shall not exceed the credit amount allocated 

5 for purposes of this section by the Secretary to the tax6 payer for such taxable year under subsection (e). 

7 ‘‘(c) RENEWABLE CHEMICAL PRODUCTION FACIL8 ITY.—For purposes of this section— 

9 ‘‘(1) IN GENERAL.—The term ‘renewable chem10 ical production facility’ means a facility used to 

11 produce renewable chemicals— 

12 ‘‘(A) which is owned by the taxpayer, 

13 ‘‘(B) which is originally placed after the 

14 date of the enactment of this section and before 

15 the first day of the taxable year which begins 

16 6 years after the date of the enactment of this 

17 section, and 

18 ‘‘(C) with respect to which— 

19 ‘‘(i) no credit has been allowed under 

20 section 45S, and 

21 ‘‘(ii) the taxpayer makes an irrev22 ocable election to have this section apply to 

23 such facility. 

24 ‘‘(2) ELIGIBLE PROPERTY.—The term ‘eligible 

25 property’ means any property— 


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1 ‘‘(A) which is— 

2 ‘‘(i) tangible personal property, or 

3 ‘‘(ii) other tangible property (not in4 cluding a building or its structural compo5 nents), 

6 but only if such property is used as an integral 

7 part of the renewable chemical production facil8 ity, and 

9 ‘‘(B) with respect to which depreciation (or 

10 amortization in lieu of depreciation) is allow11 able. 

12 ‘‘(3) RENEWABLE CHEMICAL.—The term ‘re13 newable chemical’ has the meaning given such term 

14 by section 45S(d). 

15 ‘‘(d) SPECIAL RULES.— 

16 ‘‘(1) DENIAL OF PRODUCTION CREDIT.—No 

17 credit shall be allowed under section 45S for any 

18 taxable year with respect to any renewable chemical 

19 production facility. 

20 ‘‘(2) CERTAIN QUALIFIED PROGRESS EXPENDI21 TURES RULES MADE APPLICABLE.—Rules similar to 

22 the rules of subsections (c)(4) and (d) of section 46 

23 (as in effect on the day before the enactment of the 

24 Revenue Reconciliation Act of 1990 shall apply for 

25 purposes of this section. 


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1 ‘‘(e) NATIONAL LIMITATION ON CREDITS FOR RE2 NEWABLE CHEMICALS.— 

3 ‘‘(1) IN GENERAL.—Not later than 180 days 

4 after the date of the enactment of this section, the 

5 Secretary, in consultation with the Secretary of Ag6 riculture, shall establish a program to allocate credit 

7 amounts under this section and section 45S to appli8 cants for taxable years. 

9 ‘‘(2) LIMITATIONS.— 

10 ‘‘(A) AGGREGATE LIMITATION.—The total 

11 amount of credits that may be allocated under 

12 such program shall not exceed $500,000,000. 

13 ‘‘(B) TAXPAYER LIMITATION.—The 

14 amount of credits that may be allocated to any 

15 taxpayer for any taxable year under such pro16 gram shall not exceed $25,000,000. For pur17 poses of the preceding sentence, all persons 

18 treated as a single employer under subsection 

19 (a) or (b) of section 52, or subsection (m) or 

20 (o) of section 414, shall be treated as one per21 son. 

22 ‘‘(3) SELECTION CRITERIA.—In determining 

23 which taxpayers to make allocations of credit 

24 amount under such program, the Secretary shall 

25 take into consideration— 


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1 ‘‘(A) the number of jobs created and main2 tained (directly and indirectly) in the United 

3 States (including territories and possessions of 

4 the United States) as result of such allocation 

5 during the credit period and thereafter, 

6 ‘‘(B) the degree to which the production of 

7 the renewable chemical demonstrates reduced 

8 dependence on imported feedstocks, petroleum, 

9 non-renewable resources, or other fossil fuels, 

10 ‘‘(C) the technological innovation involved 

11 in the production method of the renewable 

12 chemical, 

13 ‘‘(D) the energy efficiency and reduction in 

14 lifecycle greenhouse gases of the renewable 

15 chemical or of the production method of the re16 newable chemical, and 

17 ‘‘(E) whether there is a reasonable expec18 tation of commercial viability. 

19 ‘‘(4) REDISTRIBUTION.—If a credit amount al20 located to a taxpayer for a taxable year with respect 

21 to any renewable chemical or renewable chemical 

22 production facility (determined without regard to 

23 this paragraph) exceeds the amount of the credit 

24 with respect to such chemical determined under this 


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1 section on the taxpayer’s return for such taxable 

2 year— 

3 ‘‘(A) the credit amount allocated to such 

4 taxpayer for such taxable year with respect to 

5 such renewable chemical shall be treated as 

6 being the amount so determined on the tax7 payer’s return, and 

8 ‘‘(B) such excess may, subject to sub9 section (e), be reallocated by the Secretary con10 sistent with the requirements of paragraphs 

11 (2)(B) and (3). 

12 ‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Sec13 retary shall, upon making an allocation of credit 

14 amount under this section, publicly disclose the iden15 tity of the applicant and the amount of the credit 

16 with respect to such applicant. 

17 ‘‘(f) COORDINATION WITH PRODUCTION CREDIT FOR

18 RENEWABLE CHEMICALS.— 

19 ‘‘(1) IN GENERAL.—If a taxpayer makes an 

20 election under paragraph (2) with respect to a re21 newable chemical production facility, a credit shall 

22 not be allowed under section 45S for any renewable 

23 chemical produced by such facility. 

24 ‘‘(2) ELECTION.—If no credit has been allowed 

25 under section 45S with respect to a renewable chemVerDate Sep 11 2014 00:48 Aug 07, 2015 Jkt 049200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H3390.IH H3390

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1 ical produced by a renewable chemical production fa2 cility, a taxpayer may make an irrevocable election 

3 to have this section apply with respect to such facil4 ity in lieu of section 45S with respect to such renew5 able chemical. 

6 ‘‘(g) REGULATIONS.—The Secretary shall issue such 

7 regulations or other guidance as may be necessary to carry 

8 out this section and section 45S. 

9 ‘‘(h) TERMINATION.—The Secretary may not allocate 

10 any credit amount under this section to any taxable year 

11 which begins more than 5 years after the date of the en12 actment of this section.’’. 

13 (c) CREDITS ALLOWABLE AGAINST ALTERNATIVE

14 MINIMUM TAX.—Subparagraph (B) of section 38(c)(4) of 

15 such Code is amended by redesignating clauses (vii) 

16 through (ix) as clauses (ix) through (xi), respectively, and 

17 by inserting after clause (vi) the following new clauses: 

18 ‘‘(vii) the credit determined under sec19 tion 45S, 

20 ‘‘(viii) the credit determined under 

21 section 46 to the extent that such credit is 

22 attributable to the renewable chemical pro23 duction facilities credit under section 

24 48E,’’. 

25 (d) CLERICAL AMENDMENTS.— 


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1 (1) The table of sections for subpart D of part 

2 IV of subchapter A of chapter 1 of such Code is 

3 amended by adding at the end the following new 

4 item: 

‘‘Sec. 45S. Credit for production of renewable chemicals.’’. 

5 (2) The table of sections for subpart E of part 

6 IV of subchapter A of chapter 1 of such Code is 

7 amended by adding at the end the following new 

8 item: 

‘‘Sec. 48E. Investment credit for renewable chemical production facilities.’’. 

9 (e) EFFECTIVE DATES.— 

10 (1) PRODUCTION CREDIT.—The amendments 

11 made by subsection (a) shall apply to renewable 

12 chemicals produced after the date of the enactment 

13 of this Act, in taxable years ending after such date. 

14 (2) INVESTMENT CREDIT.—The amendments 

15 made by subsection (b) shall apply to renewable 

16 chemical production facilities placed in service after 

17 the date of the enactment of this Act, in taxable 

18 years ending after such date. 

Æ 


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