I 

111TH CONGRESS 

2D SESSION H. R. 6328 

To amend the Internal Revenue Code of 1986 to encourage the re-refining 

of used oil. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 29, 2010 

Mr. ETHERIDGE 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 encourage 

the re-refining of used oil. 

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 ‘‘Used Oil Re-Refining 

5 Tax Credit Act of 2010’’. 

6 SEC. 2. USED OIL RE-REFINING INVESTMENT TAX CREDIT. 

7 (a) QUALIFYING USED OIL RE-REFINING TAX

8 CREDIT.—Subpart E of part IV of subchapter A of chap9 ter 1 of the Internal Revenue Code of 986 is amended 

10 by inserting after section 48D the following new section: 


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1 ‘‘SEC. 48E. QUALIFYING USED OIL RE-REFINING PROJECT 

2 CREDIT. 

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

4 qualifying used oil re-refining project credit for any tax5 able year is an amount equal to 30 percent of the qualified 

6 investment for such taxable year with respect to any quali7 fying used oil re-refining project. 

8 ‘‘(b) QUALIFIED INVESTMENT.— 

9 ‘‘(1) IN GENERAL.—For purposes of subsection 

10 (a), the qualified investment for any taxable year is 

11 the basis of eligible property placed in service by the 

12 taxpayer during such taxable year which is part of 

13 a qualifying used oil re-refining project. 

14 ‘‘(2) SPECIAL RULE FOR CERTAIN SUBSIDIZED

15 PROPERTY.—Rules similar to section 48(a)(4) (other 

16 than subparagraph (D) thereof) shall apply for pur17 poses of this section. 

18 ‘‘(3) CERTAIN QUALIFIED PROGRESS EXPENDI19 TURES RULES MADE APPLICABLE.—Rules similar to 

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

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

22 Revenue Reconciliation Act of 1990) shall apply for 

23 purposes of this section. 

24 ‘‘(4) LIMITATION.—The amount which is treat25 ed as qualified investment for all taxable years with 

26 respect to any qualifying used oil re-refining project 


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1 shall not exceed the amount certified by the Sec2 retary as eligible for the credit under this section. 

3 ‘‘(c) DEFINITIONS.—For purposes of this section— 

4 ‘‘(1) QUALIFYING USED OIL RE-REFINING

5 PROJECT.—The term ‘qualifying used oil re-refining 

6 project’ means any project— 

7 ‘‘(A) which is designed to serve the pri8 mary purpose of processing qualifying re-re9 fined lubricating oil from used oil (including 

10 used lube oil derived from crude oil, synthetic 

11 oils, and qualified fuels), 

12 ‘‘(B) which uses a series of mechanical or 

13 chemical methods, or both, including, at a min14 imum, vacuum distillation followed by solvent 

15 refining or hydrotreating, 

16 ‘‘(C) the feedstock input for which is used 

17 lubricating oil, 

18 ‘‘(D) with respect to which the applicant 

19 provides evidence that the output of the project 

20 is base oil which meets the American Society of 

21 Testing and Materials standard for hydrocarbon 

22 lubricating base oil (ASTM D6074), 

23 ‘‘(E) with respect to which the applicant 

24 provides evidence that the of ownership or con25 trol of a site of sufficient size to allow the proVerDate Mar 15 2010 03:32 Oct 13, 2010 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6328.IH H6328

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1 posed project to be constructed or to operate on 

2 a long-term basis, and 

3 ‘‘(F) which will be located in the United 

4 States. 

5 ‘‘(2) QUALIFYING RE-REFINED LUBRICATING

6 OIL.—The term ‘qualifying re-refined lubricating oil’ 

7 means a base oil— 

8 ‘‘(A) which meets the American Society of 

9 Testing and Materials standard for hydrocarbon 

10 lubricating base oil (ASTM D6074), and 

11 ‘‘(B) which is manufactured from used lu12 bricating oil. 

13 ‘‘(3) ELIGIBLE PROPERTY.—The term ‘eligible 

14 property’ means any property— 

15 ‘‘(A)(i) the construction, reconstruction, 

16 expansion or erection of which is completed by 

17 the taxpayer, or 

18 ‘‘(ii) which is acquired by the taxpayer if 

19 the original use of such property commences 

20 with the taxpayer, and 

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

22 amortization in lieu of depreciation) is allow23 able. 

24 ‘‘(d) QUALIFYING USED OIL RE-REFINERY PROJECT

25 PROGRAM.— 


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1 ‘‘(1) ESTABLISHMENT.—Not later than 180 

2 days after the date of enactment of this section, the 

3 Secretary, in consultation with the Secretary of En4 ergy, shall establish a qualifying used oil re-refining 

5 project program for the deployment of used oil re6 refining technologies. 

7 ‘‘(2) CERTIFICATION.— 

8 ‘‘(A) APPLICATION PERIOD.—Each appli9 cant for certification under this paragraph shall 

10 submit an application meeting the requirements 

11 of subparagraph (B). An applicant may only 

12 submit an application during the 5-year period 

13 beginning on the date the Secretary establishes 

14 the program under paragraph (1). 

15 ‘‘(B) REQUIREMENTS FOR APPLICATIONS

16 FOR CERTIFICATION.—An application under 

17 subparagraph (A) shall contain such informa18 tion as the Secretary may require. Any informa19 tion contained in the application shall be pro20 tected as provided in section 552(b)(4) of title 

21 5, United States Code. 

22 ‘‘(C) TIME TO ACT UPON APPLICATIONS

23 FOR CERTIFICATION.—The Secretary shall issue 

24 a determination as to whether an applicant has 

25 met the requirements of this section within 60 


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1 days following the date of submittal of the ap2 plication for certification. 

3 ‘‘(D) FEDERAL AND STATE ENVIRON4 MENTAL AUTHORIZATION REQUIRED.—The Sec5 retary shall not certify a project under this sec6 tion unless the Secretary determines that the 

7 applicant for certification has received all Fed8 eral and State environmental authorizations or 

9 reviews necessary to commence construction of 

10 the project. 

11 ‘‘(E) PERIOD OF ISSUANCE.—An applicant 

12 which receives a certification shall have 5 years 

13 from the date of issuance of the certification in 

14 order to place the project in service, and if such 

15 project is not placed in service by that time pe16 riod, then the certification shall no longer be 

17 valid. 

18 ‘‘(3) LIMITATION.—The aggregate credits that 

19 may be allocated under the program shall not exceed 

20 $150,000,000. 

21 ‘‘(4) REALLOCATION.—If the Secretary deter22 mines that credits under this section are available 

23 for reallocation pursuant to the requirements set 

24 forth in paragraph (2), the Secretary is authorized 


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1 to conduct an additional program for applications 

2 for certification.’’. 

3 (b) CREDIT TREATED AS INVESTMENT TAX CRED4 IT.—Section 46 of such Code is amended by striking 

5 ‘‘and’’ at the end of paragraph (5), by striking the period 

6 at the end of paragraph (6) and inserting ‘‘, plus’’, and 

7 by adding at the end the following new paragraph: 

8 ‘‘(7) the qualifying used oil re-refining project 

9 credit determined under section 48E(a).’’. 

10 (c) CLERICAL AMENDMENT.—The table of sections 

11 for subpart E of part IV of subchapter A of chapter 1 

12 of such Code is amended by inserting after the item relat13 ing to section 48D the following new item: 

‘‘Sec. 48E. Qualifying used oil re-refining project credit.’’. 

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

15 this section shall apply to periods after the date of the 

16 enactment of this Act, under rules similar to the rules of 

17 section 48(m) of the Internal Revenue Code of 1986 (as 

18 in effect on the day before the date of the enactment of 

19 the Revenue Reconciliation Act of 1990). 

Æ 


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