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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2546 Introduced in Senate (IS)]

106th CONGRESS
  2d Session
                                S. 2546

To amend the Clean Air Act to prohibit the use of methyl tertiary butyl 
 ether, to provide flexibility within the oxygenate requirement of the 
 reformulated gasoline program of the Environmental Protection Agency, 
    to promote the use of renewable ethanol, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 11, 2000

Mr. Bond (for himself, Mr. Durbin, Mr. Grassley, Mr. Ashcroft, and Mr. 
  Fitzgerald) introduced the following bill; which was read twice and 
       referred to the Committee on Environment and Public Works

_______________________________________________________________________

                                 A BILL

 
To amend the Clean Air Act to prohibit the use of methyl tertiary butyl 
 ether, to provide flexibility within the oxygenate requirement of the 
 reformulated gasoline program of the Environmental Protection Agency, 
    to promote the use of renewable ethanol, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Clean Air and Water Preservation Act 
of 2000''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) the oxygenate requirement of the reformulated gasoline 
        program under the Clean Air Act (42 U.S.C. 7401 et seq.) has 
        proven to be effective in reducing emissions of exhaust 
        hydrocarbons, nitrous oxide, and carbon monoxide, which are 
        precursors to smog;
            (2) methyl tertiary butyl ether (referred to in this Act as 
        ``MTBE''), an oxygenate selected by gasoline refiners to comply 
        with regulations promulgated under the Clean Air Act (42 U.S.C. 
        7401 et seq.), has been discovered in water sources throughout 
        the United States;
            (3) MTBE renders water undrinkable and is considered to be 
        a probable carcinogen by the Environmental Protection Agency;
            (4) MTBE is highly soluble in water and slow to degrade;
            (5) as little as 1 gallon of MTBE can contaminate 
        26,000,000 gallons of water;
            (6) ethanol, an alternative oxygenate, is a biobased 
        product that, as compared with MTBE--
                    (A) produces the same reductions in emissions;
                    (B) is not as soluble in water;
                    (C) biodegrades rapidly; and
                    (D) is considered safe for the environment;
            (7) the oxygenate requirement of the reformulated gasoline 
        program requires that 2 percent by weight of an oxygenate be 
        added to gasoline;
            (8) because ethanol contains approximately twice as much as 
        oxygen as MTBE, supplying the reformulated gasoline program 
        with sufficient ethanol to replace MTBE would require half the 
        volume of MTBE currently used;
            (9) the ethanol industry is expanding rapidly;
            (10) ethanol production capacity in 1998 was estimated at 
        1,800,000,000 gallons, but new production facilities that began 
        operation in 1999 have greatly increased that capacity;
            (11) a recent report completed for the Governors' Ethanol 
        Coalition concludes that the United States ethanol industry 
        could easily expand ethanol production to more than 
        3,400,000,000 gallons by 2004, which would amply meet the 
        demand for oxygenates created by any MTBE phase-out without 
        causing supply shortages or increased consumer gasoline costs;
            (12) the Department of Agriculture estimates that replacing 
        MTBE with ethanol would--
                    (A) increase the demand for corn for ethanol by 
                more than 500,000,000 bushels each year, improving the 
                price of corn by 14 cents per bushel each year and 
                increasing average total farm cash receipts by 
                $1,000,000,000 each year;
                    (B) create 13,000 new jobs; and
                    (C) increase the average annual United States 
                agricultural net export value by more than $200,000,000 
                and reduce the average annual United States import 
                value of MTBE by $1,100,000,000, resulting in an 
                improved United States trade balance of $1,300,000,000 
                each year;
            (13) ethanol is an energy-efficient fuel;
            (14)(A) a 1995 report by the Department of Agriculture 
        estimated that 1 gallon of ethanol provides 25 percent more 
        energy than is required to produce the gallon; and
            (B) other studies demonstrate that the net energy gain 
        potential of ethanol could exceed 150 percent when state-of-
        the-art agricultural and production technologies are used;
            (15) ethanol has been proven to enhance the performance of 
        automobiles, and all vehicle manufacturers approve the use of 
        10 percent ethanol-blended fuels;
            (16) replacing MTBE with ethanol would maintain the 
        emission reductions obtained through the reformulated gasoline 
        program without the water contamination problems associated 
        with MTBE;
            (17) in implementing Public Law 101-549 and the amendments 
        made by that Public Law (referred to in this section as the 
        ``Clean Air Act Amendments of 1990''), the Environmental 
        Protection Agency requires, by regulation, that each gallon of 
        gasoline sold under the reformulated gasoline program contain a 
        minimum of 1.5 percent by weight of oxygenate;
            (18) that requirement--
                    (A) was not the intent of Congress in enacting the 
                oxygenate requirement; and
                    (B) prohibits the most efficient use of oxygenates;
            (19) rescinding that regulatory requirement would provide--
                    (A) to refiners, more flexibility in complying with 
                the reformulated gasoline program; and
                    (B) to consumers of gasoline, a stable supply of 
                high performance gasoline;
            (20) because increased flexibility in the use of oxygenates 
        could lead to increases in the use of aromatics (many of which 
        are known carcinogens), and in the emission of toxic air 
        pollutants, a limit on the quantity of aromatics added to 
        gasoline and a prohibition on an increase in emissions of toxic 
        air pollutants above the level achieved by using reformulated 
        gasoline are necessary to protect human health and the 
        environment;
            (21) when Congress enacted the Clean Air Act Amendments of 
        1990, volatile organic compounds were thought to be the 
        principal precursors to ozone formation;
            (22) the weight of the scientific evidence accumulated 
        since the enactment of the Clean Air Act Amendments of 1990 
        indicates that carbon monoxide is an increasingly significant 
        ozone precursor;
            (23) off-road engines generate high levels of emissions of 
        volatile organic compounds and carbon monoxide relative to on-
        road engines, because off-road engines are not typically 
        equipped with emission control systems;
            (24) emissions of volatile organic compounds and carbon 
        monoxide from off-road engines are significantly reduced when 
        oxygenates are present in the fuel;
            (25) adding oxygen to gasoline provides unique air quality 
        benefits that exceed those ensured by the performance standards 
        under the Clean Air Act (42 U.S.C. 7401 et seq.), including 
        reductions in exhaust hydrocarbons, carbon monoxide, and fine 
        particulates; and
            (26) oxygenates are the only means of reducing emissions 
        from non-catalyst off-road engines that are a major source of 
        ozone pollution in urban areas.

SEC. 3. USE OF MTBE AS A FUEL ADDITIVE.

    (a) Prohibition on Use of MTBE and Other Ether Compounds.--Section 
211(c) of the Clean Air Act (42 U.S.C. 7545(c)) is amended by adding at 
the end the following:
            ``(5) Prohibition on use of mtbe and other ether 
        compounds.--
                    ``(A) In general.--Subject to subparagraph (B), the 
                regulations promulgated under paragraph (1) shall 
                prohibit the use of methyl tertiary butyl ether or any 
                other ether compound as a fuel additive.
                    ``(B) Waiver.--The Administrator may by regulation 
                waive the prohibition under subparagraph (A) with 
                respect to an ether compound other than methyl tertiary 
                butyl ether if the Administrator determines that the 
                use of the ether compound as a fuel additive will not 
                pose a significant risk to human health or the 
                environment.''.
    (b) Regulations.--As soon as practicable after the date of 
enactment of this Act, the Administrator of the Environmental 
Protection Agency shall revise the regulations promulgated under 
section 211(c)(1) of the Clean Air Act (42 U.S.C. 7545(c)(1)) to 
conform to the amendment made by subsection (a).
    (c) Labeling.--During the period beginning on the date of enactment 
of this Act and ending 3 years after that date, the Administrator of 
the Environmental Protection Agency shall require any person selling at 
retail gasoline that contains methyl tertiary butyl ether to 
prominently label the fuel dispensing system for the gasoline with a 
notice that the gasoline contains methyl tertiary butyl ether.
    (d) Effective Date.--Subsection (a) takes effect 3 years after the 
date of enactment of this Act.

SEC. 4. CLEANUP GUIDELINES FOR CONTAMINATION OF WATER BY MTBE.

    Section 1442 of the Safe Drinking Water Act (42 U.S.C. 300j-1) is 
amended by adding at the end the following:
    ``(f) Cleanup Guidelines for MTBE Contamination.--The Administrator 
shall develop technical guidelines to assist States in the 
investigation and cleanup of methyl tertiary butyl ether in ground 
water.''.

SEC. 5. OXYGEN AVERAGING UNDER THE REFORMULATED GASOLINE PROGRAM.

    (a) In General.--Section 211(k) of the Clean Air Act (42 U.S.C. 
7545(k)) is amended--
            (1) in paragraphs (2)(B) and (3)(A)(v), by inserting 
        ``averaged on an annual basis'' after ``2.0 percent by weight'' 
        each place it appears; and
            (2) in paragraph (2)(B), by adding at the end the 
        following: ``The regulations shall not specify a minimum oxygen 
        content.''.
    (b) Regulations.--Not later than October 1, 2000, the Administrator 
of the Environmental Protection Agency shall revise the regulations 
promulgated under section 211(k) of the Clean Air Act (42 U.S.C. 
7545(k)) to conform to the amendments made by subsection (a).

SEC. 6. ANTI-BACKSLIDING.

    Section 211(k)(3)(B) of the Clean Air Act (42 U.S.C. 7545(k)(3)(B)) 
is amended--
            (1) by striking ``Any reduction'' and inserting the 
        following:
                            ``(iii) Treatment of greater reductions.--
                        Any reduction''; and
            (2) by adding at the end the following:
                            ``(iv) Ozone anti-backsliding provision.--
                                    ``(I) In general.--Not later than 
                                October 1, 2000, the Administrator 
                                shall revise the performance standards 
                                under this subparagraph to ensure that 
                                the ozone-forming potential, taking 
                                into account all ozone precursors 
                                (including volatile organic compounds, 
                                oxides of nitrogen, and carbon 
                                monoxide), of the aggregate emissions 
                                during the high ozone season (as 
                                determined by the Administrator) from 
                                baseline vehicles when using 
                                reformulated gasoline does not exceed 
                                the ozone-forming potential of the 
                                aggregate emissions during the high 
                                ozone season from baseline vehicles 
                                when using reformulated gasoline that 
                                complies with the regulations that--
                                            ``(aa) were in effect on 
                                        September 1, 1999; and
                                            ``(bb) were applicable to 
                                        reformulated gasoline sold in 
                                        calendar year 2000 and 
                                        subsequent calendar years.
                                    ``(II) Adjustment for emissions of 
                                carbon monoxide.--
                                            ``(aa) In general.--In 
                                        carrying out subclause (I), the 
                                        Administrator shall adjust the 
                                        performance standard for 
                                        emissions of volatile organic 
                                        compounds under this 
                                        subparagraph to account for 
                                        emissions of carbon monoxide 
                                        that are greater than or less 
                                        than the carbon monoxide 
                                        baseline determined under item 
                                        (bb).
                                            ``(bb) Carbon monoxide 
                                        baseline.--The carbon monoxide 
                                        baseline shall be equal to the 
                                        mass carbon monoxide emissions 
                                        achieved by reformulated 
                                        gasoline that contains 2 
                                        percent oxygen by weight and 
                                        meets the other performance 
                                        standards under this 
                                        subparagraph.
                                    ``(III) Updating of baseline 
                                vehicles.--Not later than 3 years after 
                                the date of enactment of this clause, 
                                the Administrator shall revise the 
                                performance standards under this 
                                subparagraph by redefining the term 
                                `baseline vehicles' as used in this 
                                clause to mean vehicles representative 
                                of vehicles (including off-road 
                                vehicles) in use as of January 1, 2000.
                            ``(v) Toxics and particulate matter anti-
                        backsliding provision.--
                                    ``(I) In general.--Not later than 
                                October 1, 2000, the Administrator 
                                shall revise the performance standards 
                                under this subparagraph to ensure that 
                                the aggregate emissions of precursors 
                                of pollutants specified in subclause 
                                (II) from baseline vehicles when using 
                                reformulated gasoline do not exceed the 
                                aggregate emissions of precursors of 
                                pollutants specified in subclause (II) 
                                from baseline vehicles when using 
                                reformulated gasoline that complies 
                                with the regulations that--
                                            ``(aa) were in effect on 
                                        January 1, 2000; and
                                            ``(bb) were applicable to 
                                        reformulated gasoline sold in 
                                        calendar year 2000 and 
                                        subsequent calendar years.
                                    ``(II) Specified pollutants.--The 
                                pollutants referred to in subclause (I) 
                                are--
                                            ``(aa) toxic air 
                                        pollutants, as measured 
                                        according to their toxicity;
                                            ``(bb) PM-10; and
                                            ``(cc) fine particulate 
                                        matter.
                            ``(vi) Aromatic content of reformulated 
                        gasoline.--
                                    ``(I) Average.--Subject to 
                                subclause (II), the average aromatic 
                                hydrocarbon content of reformulated 
                                gasoline shall not exceed the average 
                                aromatic hydrocarbon content of 
                                reformulated gasoline sold in covered 
                                areas for use in baseline vehicles when 
                                using reformulated gasoline during 
                                calendar year 2000.
                                    ``(II) Maximum.--No reformulated 
                                gasoline shall have an aromatic 
                                hydrocarbon content in excess of 30 
                                percent.
                            ``(vii) Olefin content of reformulated 
                        gasoline.--
                                    ``(I) Average.--Subject to 
                                subclause (II), the average olefin 
                                content of reformulated gasoline shall 
                                not exceed the average olefin content 
                                of reformulated gasoline sold in 
                                covered areas for use in baseline 
                                vehicles when using reformulated 
                                gasoline during calendar year 2000.
                                    ``(II) Maximum.--No reformulated 
                                gasoline shall have an olefin content 
                                in excess of 10 percent.''.

SEC. 7. REVISION OF WAIVER PROVISION.

    Section 211(k) of the Clean Air Act (42 U.S.C. 7545(k)) is 
amended--
            (1) in paragraph (2)(B), by striking the second sentence;
            (2) by redesignating paragraph (10) as paragraph (11); and
            (3) by inserting after paragraph (9) the following:
            ``(10) Temporary reduction of oxygen content requirement.--
                    ``(A) In general.--If the Secretary of Energy, with 
                the concurrence of the Secretary of Agriculture, finds 
                that there is an insufficient domestic supply of 
                oxygenates to meet the oxygen content requirement of 
                paragraphs (2)(B) and (3)(A)(v), the Administrator may, 
                in accordance with section 307, promulgate regulations 
                temporarily reducing the oxygen content requirement to 
                the extent necessary to ensure an adequate supply of 
                oxygenates.
                    ``(B) Duration of reduction.--
                            ``(i) In general.--A temporary reduction in 
                        the oxygen content requirement under 
                        subparagraph (A) shall remain in effect for a 
                        period of 90 days unless the Secretary of 
                        Energy finds, before the end of that period, 
                        that an adequate supply of oxygenates exists.
                            ``(ii) Extension.--Upon the expiration of 
                        the 90-day period under clause (i), the 
                        temporary reduction in the oxygen content 
                        requirement may be extended for an additional 
                        90-day period in accordance with subparagraph 
                        (A).
                    ``(C) Maintenance of environmental benefits.--
                Regulations promulgated under subparagraph (A) shall 
                ensure that the environmental benefits of reformulated 
                gasoline are maintained during the period of the 
                temporary reduction in the oxygen content 
                requirement.''.

SEC. 8. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED GASOLINE PROGRAM.

    Section 211(k)(6) of the Clean Air Act (42 U.S.C. 7545(k)(6)) is 
amended--
            (1) by striking ``(6) Opt-in areas.--(A) Upon'' and 
        inserting the following:
            ``(6) Opt-in areas.--
                    ``(A) Classified areas.--
                            ``(i) In general.--Upon'';
            (2) in subparagraph (B), by striking ``(B) If'' and 
        inserting the following:
                            ``(ii) Effect of insufficient domestic 
                        capacity to produce reformulated gasoline.--
                        If'';
            (3) in subparagraph (A)(ii) (as so redesignated)--
                    (A) in the first sentence, by striking 
                ``subparagraph (A)'' and inserting ``clause (i)''; and
                    (B) in the second sentence, by striking ``this 
                paragraph'' and inserting ``this subparagraph''; and
            (4) by adding at the end the following:
                    ``(B) Nonclassified areas.--
                            ``(i) In general.--Upon the application of 
                        the Governor of a State, the Administrator 
                        shall apply the prohibition specified in 
                        paragraph (5) in any area in the State that is 
                        not a covered area or an area referred to in 
                        subparagraph (A)(i).
                            ``(ii) Publication of application.--As soon 
                        as practicable after receipt of an application 
                        under clause (i), the Administrator shall 
                        publish the application in the Federal 
                        Register.''.

SEC. 9. ANTI-DUMPING RULES.

    The Administrator of the Environmental Protection Agency shall 
revise the regulations promulgated under section 211(k)(8) of the Clean 
Air Act (42 U.S.C. 7545(k)(8)) to ensure that this Act and the 
amendments made by this Act do not result in any increased emissions in 
areas that are not covered areas (as defined in section 211(k)(11) of 
the Clean Air Act (as redesignated by section 7(a)(2))).

SEC. 10. STATE REASONABLE FURTHER PROGRESS DEMONSTRATIONS.

    Section 182(c)(2)(B) of the Clean Air Act (42 U.S.C. 
7511a(c)(2)(B)) is amended by adding at the end the following: ``In 
making the demonstration required under this subparagraph, a State may 
claim as a credit toward the requirement for VOC emission reductions an 
amount equivalent to the ozone-forming potential of carbon monoxide 
emission reductions attributable to any amount by which the average 
oxygen content of reformulated gasoline sold in the State exceeds 2 
percent.''.

SEC. 11. PREVENTION OF EFFECTS ON HIGHWAY APPORTIONMENTS.

    (a) Surface Transportation Program.--Section 104(b)(3) of title 23, 
United States Code, is amended by adding at the end the following:
                    ``(C) Determination of estimated tax payments.--For 
                the purpose of determining under subparagraph (A)(iii) 
                the estimated tax payments attributable to highway 
                users in a State paid into the Highway Trust Fund 
                (other than the Mass Transit Account) in a fiscal year, 
                the amount paid into the Highway Trust Fund with 
                respect to the sale of gasohol or other fuels 
                containing alcohol by reason of the tax imposed by 
                section 4041 (relating to special fuels) or 4081 
                (relating to gasoline) of the Internal Revenue Code of 
                1986 shall be treated as being equal to the amount that 
                would have been so imposed with respect to that sale 
                without regard to the reduction in revenues resulting 
                from the application of the regulations promulgated 
                under section 211(c)(5) of the Clean Air Act (42 U.S.C. 
                7545(c)(5)) and the following provisions of the 
                Internal Revenue Code of 1986:
                            ``(i) Section 4041(b)(2) (relating to 
                        exemption for qualified methanol and ethanol 
                        fuel).
                            ``(ii) Section 4041(k) (relating to fuels 
                        containing alcohol).
                            ``(iii) Section 4041(m) (relating to 
                        certain alcohol fuels).
                            ``(iv) Section 4081(c) (relating to reduced 
                        rate on gasoline mixed with alcohol).''.
    (b) Minimum Guarantee.--Section 105(f)(1) of title 23, United 
States Code, is amended--
                    (A) by striking ``(1) In general.--Before'' and 
                inserting the following: ``(1) In general.--
                    ``(A) Adjustment.--Before''; and
                    (B) by adding at the end the following:
                    ``(B) Determination of estimated tax payments.--For 
                the purpose of determining under this subsection the 
                estimated tax payments attributable to highway users in 
                a State paid into the Highway Trust Fund (other than 
                the Mass Transit Account) in a fiscal year, the amount 
                paid into the Highway Trust Fund with respect to the 
                sale of gasohol or other fuels containing alcohol by 
                reason of the tax imposed by section 4041 (relating to 
                special fuels) or 4081 (relating to gasoline) of the 
                Internal Revenue Code of 1986 shall be treated as being 
                equal to the amount that would have been so imposed 
                with respect to that sale without regard to the 
                reduction in revenues resulting from the application of 
                the regulations promulgated under section 211(c)(5) of 
                the Clean Air Act (42 U.S.C. 7545(c)(5)) and the 
                following provisions of the Internal Revenue Code of 
                1986:
                            ``(i) Section 4041(b)(2) (relating to 
                        exemption for qualified methanol and ethanol 
                        fuel).
                            ``(ii) Section 4041(k) (relating to fuels 
                        containing alcohol).
                            ``(iii) Section 4041(m) (relating to 
                        certain alcohol fuels).
                            ``(iv) Section 4081(c) (relating to reduced 
                        rate on gasoline mixed with alcohol).''.
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