Union Calendar No. 340
104TH CONGRESS
2D SESSION
H. R. 1514
[Report No. 104–655, Part 1]
A BILL
To authorize and facilitate a program to enhance
safety, training, research and development, and
safety education in the propane gas industry for
the benefit of propane consumers and the public,
and for other purposes.
JULY 10, 1996
Committee on Science discharged; committed to the Com-
mittee of the Whole House on the State of the Union,
and ordered to be printed
IB
Union Calendar No. 340
104TH CONGRESS
2D SESSION
H. R. 1514
[Report No. 104–655, Part 1]
To authorize and facilitate a program to enhance safety, training, research
and development, and safety education in the propane gas industry
for the benefit of propane consumers and the public, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 7, 1995
Mr. TAUZIN (for himself, Mr. HALL of Texas, Mr. CRAMER, Mr. ROEMER, Mr.
BLUTE, Mr. GILLMOR, Mr. STUMP, Mr. EMERSON, Mr. HANCOCK, Mr.
GEJDENSON, Mr. MINGE, Mr. CALLAHAN, Mr. GENE GREEN of Texas,
Mr. BAESLER, Mr. COLLINS of Georgia, Mr. BISHOP, Mr. EVERETT, Mr.
BEVILL, Mr. TAYLOR of North Carolina, Mr. BACHUS, Mr. KLUG, Mr.
HILLIARD, Mr. PARKER, Mr. JEFFERSON, Mr. LEWIS of Kentucky, Mr.
PAXON, Mr. BONILLA, Mr. MCINTOSH, Mr. TRAFICANT, Mr. OXLEY, Mr.
TALENT, Mr. BROWDER, and Mr. JACOBS) introduced the following bill;
which was referred to the Committee on Commerce, and in addition to
the Committee on Science, for a period to be subsequently determined by
the Speaker, in each case for consideration of such provisions as fall with-
in the jurisdiction of the committee concerned
JUNE 27, 1996
Reported from the Committee on Commerce with an amendment
[Strike out all after the enacting clause and insert the part printed in italic]
Referral to the Committee on Science extended for a period ending not later
than July 26, 1996
JULY 10, 1996
Additional sponsors: Mr. HAMILTON, Mr. MONTGOMERY, Mrs. FOWLER, Mrs.
MEEK of Florida, Ms. KAPTUR, Mr. DUNCAN, Mr. BRYANT of Tennessee,
Mr. MYERS of Indiana, Mr. FOLEY, Mr. GILMAN, Mr. CUNNINGHAM, Mr.
HOEKSTRA, Mr. ROGERS, Mrs. LINCOLN, Mr. SOLOMON, Ms. DANNER,
Mr. HEFNER, Mr. JOHNSON of South Dakota, Mr. BRYANT of Texas, Mr.
BURR, Mr. LARGENT, Mr. GORDON, Mr. LIPINSKI, Mr. MARTINEZ, Mr.
SENSENBRENNER, Mr. RICHARDSON, Mr. QUILLEN, Mr. PAYNE of Vir-
ginia, Mr. WOLF, Mr. FUNDERBURK, Mr. SKELTON, Mr. SISISKY, Mr.
OBERSTAR, Mr. TANNER, Mr. VOLKMER, Mr. ROSE, Ms. LOFGREN, Mr.
SPENCE, Mr. MCCRERY, Mr. BARTLETT of Maryland, Ms. PRYCE, Mr.
SPRATT, Mr. STENHOLM, Mr. BUNNING of Kentucky, Mr. PETERSON of
Minnesota, Mr. HOBSON, Mr. SMITH of New Jersey, Mr. STEARNS, Mr.
MCCOLLUM, Mr. CRAPO, Mrs. MEYERS of Kansas, Mr. FRELINGHUYSEN,
Mr. BENTSEN, Mr. FIELDS of Texas, Mrs. MYRICK, Mr. POMEROY, Mr.
CHAMBLISS, Mr. LUCAS, Mr. PICKETT, Mr. PETRI, Mr. WHITFIELD, Mr.
WARD, Mr. STUPAK, Mr. FRANKS of Connecticut, Mr. SCOTT, Mr.
LAHOOD, Mr. LAZIO of New York, Mr. MANZULLO, Mr. PASTOR, Mr.
LEACH, Mr. BURTON of Indiana, Mr. WICKER, Mr. HALL of Ohio, Mr.
BARCIA, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. BREWSTER, Mr.
KLINK, Mr. HINCHEY, Mr. MOORHEAD, Mr. TAYLOR of Mississippi, Ms.
FURSE, Mr. LINDER, Mr. FRANKS of New Jersey, Mr. GREENWOOD, Mr.
DEUTSCH, Mrs. VUCANOVICH, Mr. GEPHARDT, Mr. SKEEN, Mr. BOEH-
LERT, Mr. HASTERT, Mr. HUTCHINSON, Mr. THORNBERRY, Mr.
HAYWORTH, Mrs. KELLY, Mr. GRAHAM, Mr. WAMP, Mr. DOOLEY of Cali-
fornia, Mr. LOBIONDO, Mr. DICKEY, Mr. ABERCROMBIE, Mr. NORWOOD,
Mr. JOHNSTON of Florida, Mr. KILDEE, Ms. MCCARTHY, Mr. MARTINI,
Mr. ZELIFF, Mrs. LOWEY, Mr. WILSON, Mr. ANDREWS, Mr. BAKER of
Louisiana, Mr. GOODLATTE, Mr. CLAY, Ms. MCKINNEY, Mr. WELDON of
Pennsylvania, Mr. KINGSTON, Mr. BARR of Georgia, Mr. WATT of North
Carolina, Mr. WATTS of Oklahoma, Mr. LIGHTFOOT, Mr. FAZIO of Cali-
fornia, Mr. YOUNG of Alaska, Mr. HAYES, Mr. PALLONE, Mr. JONES,
Mr. CALVERT, Mr. TEJEDA, Mr. MCHUGH, Mr. WELLER, Mr. BOEHNER,
Mr. CLEMENT, Mr. OLVER, Mr. DEAL of Georgia, Mr. EVANS, Mr.
COBLE, Mr. DURBIN, Mr. PACKARD, Mr. PETE GEREN of Texas, Ms.
WOOLSEY, Mr. LAUGHLIN, Mr. FAWELL, Mr. MURTHA, Mr. CHRYSLER,
Mr. HEINEMAN, Mrs. SEASTRAND, Mr. TOWNS, Ms. DELAURO, Mr.
SCHIFF, Mr. FARR of California, Mr. EHLERS, Mr. BALLENGER, Mr. RA-
HALL, Mr. SAXTON, Mr. HASTINGS of Florida, Mr. BILBRAY, Mr. INGLIS
of South Carolina, Mr. CLYBURN, Mrs. CLAYTON, Mrs. CUBIN, Mr.
BASS, Mr. BROWN of Ohio, Mr. THORNTON, Mr. CASTLE, Mr. STUDDS,
Ms. MOLINARI, Mr. STOCKMAN, Mr. HASTINGS of Washington, Mr.
GUTKNECHT, Mr. GOODLING, Mr. GEKAS, Mrs. MORELLA, Mr. FRAZER,
Mr. EDWARDS, Mr. BROWNBACK, Mr. LATHAM, Mr. WALSH, Mr.
TIAHRT, Mr. BILIRAKIS, Mr. DAVIS, Mr. SALMON, Mr. POSHARD, Mr.
ROBERTS, Mr. BATEMAN, Mr. COSTELLO, Mr. SMITH of Texas, Mr.
MCDADE, Mr. PORTER, Mr. BARRETT of Nebraska, Mr. LEWIS of Geor-
gia, Mr. TORRES, Mr. ALLARD, Mr. FROST, Mr. CAMP, Mr. SHAYS, Mr.
GUNDERSON, Mr. HOYER, Mr. COOLEY of Oregon, Mr. LUTHER, and Mr.
MATSUI
JULY 10, 1996
Committee on Science discharged; committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[For text of introduced bill, see copy of bill as introduced on April 7, 1995]
A BILL
To authorize and facilitate a program to enhance safety,
training, research and development, and safety education
in the propane gas industry for the benefit of propane
consumers and the public, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Propane Education and
Research Act of 1996’’.
SEC. 2. FINDINGS.
The Congress finds that—
(1) propane gas, or liquefied petroleum gas, is
an essential energy commodity providing heat, hot
water, cooking fuel, and motor fuel among its many
uses to millions of Americans;
(2) the use of propane is especially important to
rural citizens and farmers, offering an efficient and
economical source of gas energy;
(3) propane has been recognized as a clean fuel
and can contribute in many ways to reducing the
pollution in our cities and towns; and
(4) propane is primarily domestically produced
and its use provides energy security and jobs for
Americans.
SEC. 3. DEFINITIONS.
For the purposes of this Act—
(1) the term ‘‘Council’’ means a Propane Edu-
cation and Research Council created pursuant to sec-
tion 4 of this Act;
(2) the term ‘‘industry’’ means those persons in-
volved in the production, transportation, and sale of
propane, and in the manufacture and distribution of
propane utilization equipment, in the United States;
(3) the term ‘‘industry trade association’’ means
an organization exempt from tax, under section
501(c) (3) or (6) of the Internal Revenue Code of
1986, representing the propane industry;
(4) the term ‘‘odorized propane’’ means propane
which has had odorant added to it;
(5) the term ‘‘producer’’ means the owner of pro-
pane at the time it is recovered at a gas processing
plant or refinery;
(6) the term ‘‘propane’’ means a hydrocarbon
whose chemical composition is predominantly C3H8,
whether recovered from natural gas or crude oil, and
includes liquefied petroleum gases and mixtures there-
of;
(7) the term ‘‘public member’’ means a member
of the Council, other than a representative of produc-
ers or retail marketers, representing significant users
of propane, public safety officials, academia, the pro-
pane research community, or other groups knowledge-
able about propane;
(8) the term ‘‘qualified industry organization’’
means the National Propane Gas Association, the Gas
Processors Association, a successor association of such
associations, or a group of retail marketers or produc-
ers who collectively represent at least 25 percent of the
volume of propane sold or produced in the United
States;
(9) the term ‘‘retail marketer’’ means a person
engaged primarily in the sale of odorized propane to
the ultimate consumer or to retail propane dispensers;
(10) the term ‘‘retail propane dispenser’’ means
a person who sells odorized propane to the ultimate
consumer but is not engaged primarily in the busi-
ness of such sales; and
(11) the term ‘‘Secretary’’ means the Secretary of
Energy.
SEC. 4. REFERENDA.
(a) CREATION OF PROGRAM.—The qualified industry
organizations may conduct, at their own expense, a referen-
dum among producers and retail marketers for the creation
of a Propane Education and Research Council. The Coun-
cil, if established, shall reimburse the qualified industry or-
ganizations for the cost of the referendum accounting and
documentation. Such referendum shall be conducted by an
independent auditing firm agreed to by the qualified indus-
try organizations. Voting rights in such referendum shall
be based on the volume of propane produced or odorized
propane sold in the previous calendar year or other rep-
resentative period. Upon approval of those persons rep-
resenting two-thirds of the total volume of propane voted
in the retail marketer class and two-thirds of all propane
voted in the producer class, the Council shall be established,
and shall be authorized to levy an assessment on odorized
propane in accordance with section 6. All persons voting
in the referendum shall certify to the independent auditing
firm the volume of propane represented by their vote.
(b) TERMINATION.—On the Council’s own initiative,
or on petition to the Council by producers and retail mar-
keters representing 35 percent of the volume of propane in
each class, the Council shall, at its own expense, hold a ref-
erendum, to be conducted by an independent auditing firm
selected by the Council, to determine whether the industry
favors termination or suspension of the Council. Termi-
nation or suspension shall not take effect unless it is ap-
proved by persons representing more than one-half of the
total volume of odorized propane in the retail marketer class
and more than one-half of the total volume of propane in
(c) MEMBERSHIP.—The Council shall consist of 21
members, with 9 members representing retail marketers, 9
members representing producers, and 3 public members.
Other than the public members, Council members shall be
full-time employees or owners of businesses in the industry
or representatives of agricultural cooperatives. No employee
of a qualified industry organization or other industry trade
association shall serve as a member of the Council, and no
member of the Council may serve concurrently as an officer
of the Board of Directors of a qualified industry organiza-
tion or other industry trade association. Only one person
at a time from any company or its affiliate may serve on
the Council.
(d) COMPENSATION.—Council members shall receive
no compensation for their services, nor shall Council mem-
bers be reimbursed for expenses relating to their service, ex-
cept that public members, upon request, may be reimbursed
for reasonable expenses directly related to their participa-
tion in Council meetings.
(e) TERMS.—Council members shall serve terms of 3
years and may serve not more than 2 full consecutive terms.
Members filling unexpired terms may serve not more than
a total of 7 consecutive years. Former members of the Coun-
cil may be returned to the Council if they have not been
members for a period of 2 years. Initial appointments to
the Council shall be for terms of 1, 2, and 3 years, staggered
to provide for the selection of 7 members each year.
(f) FUNCTIONS.—The Council shall develop programs
and projects and enter into contracts or agreements for im-
plementing this Act, including programs to enhance
consumer and employee safety and training, to provide for
research and development of clean and efficient propane
utilization equipment, to inform and educate the public
about safety and other issues associated with the use of pro-
pane, and to provide for the payment of the costs thereof
with funds collected pursuant to this Act. The Council shall
coordinate its activities with industry trade association and
others as appropriate to provide efficient delivery of services
and to avoid unnecessary duplication of activities.
(g) USE OF FUNDS.—Not less than 5 percent of the
funds collected through assessments pursuant to this Act
shall be used for programs and projects intended to benefit
the agriculture industry in the United States. The Council
shall coordinate its activities in this regard with agri-
culture industry trade associations and other organizations
representing the agriculture industry. The percentage of
funds collected through assessments pursuant to this Act to
be used for projects relating to the use of propane as an
over-the-road motor fuel shall not exceed the percentage of
the total market for odorized propane that is used as a
motor vehicle fuel, based on the historical average of such
use over the previous 3-year period.
(h) PRIORITIES.—Issues related to research and devel-
opment, safety, education, and training shall be given pri-
ority by the Council in the development of its programs and
projects.
(i) ADMINISTRATION.—The Council shall select from
among its members a Chairman and other officers as nec-
essary, may establish committees and subcommittees of the
Council, and shall adopt rules and bylaws for the conduct
of business and the implementation of this Act. The Council
shall establish procedures for the solicitation of industry
comment and recommendations on any significant plans,
programs, and projects to be funded by the Council. The
Council may establish advisory committees of persons other
than Council members.
(j) ADMINISTRATIVE EXPENSES.—(1) The administra-
tive expenses of operating the Council (not including costs
incurred in the collection of the assessment pursuant to sec-
tion 7) plus amounts paid under paragraph (2) shall not
exceed 10 percent of the funds collected in any fiscal year.
(2) The Council shall annually reimburse the Sec-
retary for costs incurred by the Federal Government relat-
ing to the Council, except that such reimbursement for any
fiscal year shall not exceed the amount that the Secretary
determines is the average annual salary of two employees
of the Department of Energy.
(k) BUDGET.—Before August 1 each year, the Council
shall publish for public review and comment a budget plan
for the next calendar year, including the probable costs of
all programs, projects, and contracts and a recommended
rate of assessment sufficient to cover such costs. Following
this review and comment, the Council shall submit the pro-
posed budget to the Secretary and to the Congress. The Sec-
retary may recommend programs and activities the Sec-
retary considers appropriate.
(l) RECORDS; AUDITS.—The Council shall keep min-
utes, books, and records that clearly reflect all of the acts
and transactions of the Council and make public such infor-
mation. The books of the Council shall be audited by a cer-
tified public accountant at least once each fiscal year and
at such other times as the Council may designate. Copies
of such audit shall be provided to all members of the Coun-
cil, all qualified industry organizations, and to other mem-
bers of the industry upon request. The Secretary shall re-
ceive notice of meetings and may require reports on the ac-
tivities of the Council, as well as reports on compliance,
violations, and complaints regarding the implementation of
this Act.
(m) PUBLIC ACCESS TO COUNCIL PROCEEDINGS.—(1)
All meetings of the Council shall be open to the public after
at least 30 days advance public notice.
(2) The minutes of all meetings of the Council shall
be made available to and readily accessible by the public.
(n) ANNUAL REPORT.—Each year the Council shall
prepare and make publicly available a report which in-
cludes an identification and description of all programs
and projects undertaken by the Council during the previous
year as well as those planned for the coming year. Such
report shall also detail the allocation or planned allocation
of Council resources for each such program and project.
SEC. 6. ASSESSMENTS.
(a) AMOUNT.—The Council shall set the initial assess-
ment at no greater than one tenth of 1 cent per gallon of
odorized propane. Thereafter, annual assessments shall be
sufficient to cover the costs of the plans and programs devel-
oped by the Council. The assessment shall not be greater
than one-half cent per gallon of odorized propane, unless
approved by a majority of those voting in a referendum
in both the producer and the retail marketer class. In no
case may the assessment be raised by more than one tenth
of 1 cent per gallon of odorized propane annually.
(b) OWNERSHIP.—The owner of odorized propane at
the time of odorization, or the time of import of odorized
propane, shall make the assessment based on the volume of
odorized propane sold and placed into commerce. Assess-
ments collected are payable to the Council on a monthly
basis by the 25th of the month following the month of such
collection. Propane exported from the United States to an-
other country is not subject to the assessment.
(c) ALTERNATIVE COLLECTION RULES.—The Council
may establish an alternative means of collecting the assess-
ment if another means is found to be more efficient and
effective. The Council may establish a late payment charge
and rate of interest to be imposed on any person who fails
to remit or pay to the Council any amount due under this
Act.
(d) INVESTMENT OF FUNDS.—Pending disbursement
pursuant to a program, plan, or project, the Council may
invest funds collected through assessments, and any other
funds received by the Council, only in obligations of the
United States or any agency thereof, in general obligations
of any State or any political subdivision thereof, in any
interest-bearing account or certificate of deposit of a bank
that is a member of the Federal Reserve System, or in obli-
gations fully guaranteed as to principal and interest by the
United States.
(e) STATE PROGRAMS.—The Council shall establish a
program coordinating the operation of the Council with
the Council may recommend to the Secretary changes in
this Act or other statutes that would further the purposes
of this Act.
SEC. 9. MARKET SURVEY AND CONSUMER PROTECTION.
(a) PRICE ANALYSIS.—Beginning 2 years after estab-
lishment of the Council and annually thereafter, the Sec-
retary of Commerce, using only data provided by the En-
ergy Information Administration and other public sources,
shall prepare and make available to the Council, the Sec-
retary of Energy, and the public an analysis of changes
in the price of propane relative to other energy sources. The
propane price analysis shall compare indexed changes in
the price of consumer grade propane to a composite of in-
dexed changes in the price of residential electricity, residen-
tial natural gas, and refiner price to end users of No. 2
fuel oil on an annual national average basis. For purposes
of indexing changes in consumer grade propane, residential
electricity, residential natural gas, and end user No. 2 fuel
oil prices, the Secretary of Commerce shall use a 5-year roll-
ing average price beginning with the year 4 years prior
to the establishment of the Council.
(b) AUTHORITY TO RESTRICT ACTIVITIES.—If in any
year the 5-year average rolling price index of consumer
grade propane exceeds the 5-year rolling average price com-
posite index of residential electricity, residential natural
gas, and refiner price to end users of No. 2 fuel oil in an
amount greater than 10.1 percent, the activities of the
Council shall be restricted to research and development,
training, and safety matters. The Council shall inform the
Secretary of Energy and the Congress of any restriction of
activities under this subsection. Upon expiration of 180
days after the beginning of any such restriction of activities,
the Secretary of Commerce shall again conduct the propane
price analysis described in subsection (a). Activities of the
Council shall continue to be restricted under this subsection
until the price index excess is 10.1 percent or less.
SEC. 10. PRICING.
In all cases, the price of propane shall be determined
by market forces. Consistent with the antitrust laws, the
Council may take no action, nor may any provision of this
Act be interpreted as establishing an agreement to pass
along to consumers the cost of the assessment provided for
in section 6.
SEC. 11. RELATION TO OTHER PROGRAMS.
Nothing in this Act may be construed to preempt or
supersede any other program relating to propane education
and research organized and operated under the laws of the
United States or any State.
SEC. 12. REPORTS.
Within 2 years after the date of enactment of this Act,
and at least once every 2 years thereafter, the Secretary of
Commerce shall prepare and submit to the Congress and
the Secretary a report examining whether operation of the
Council, in conjunction with the cumulative effects of mar-
ket changes and Federal programs, has had an effect on pro-
pane consumers, including residential, agriculture, process,
and nonfuel users of propane. The Secretary of Commerce
shall consider and, to the extent practicable, shall include
in the report submissions by propane consumers, and shall
consider whether there have been long-term and short-term
effects on propane prices as a result of Council activities
and Federal programs, and whether there have been changes
in the proportion of propane demand attributable to var-
ious market segments. To the extent that the report dem-
onstrates that there has been an adverse effect, the Secretary
of Commerce shall include recommendations for correcting
the situation. Upon petition by affected parties or upon re-
quest by the Secretary of Energy, the Secretary of Com-
merce may prepare and submit the report required by this
section at less than 2-year intervals.