Court Opinion

ID: 3161532
Source: CourtListenerOpinion
Date Created: 2015-12-10 16:10:00.644606+00
Date Added: 2024-06-11T12:02:12.671984
License: Public Domain

No. 49	                                                November 27, 2015	295
49
Blosser/Romain v. Rosenblum (IP 45)                                                            358
                                                                                     November 27,   Or
                                                                                                  2015

                                            IN THE SUPREME COURT OF THE
                                                  STATE OF OREGON

                                                         Nik BLOSSER,
                                                            Petitioner,
                                                                 v.
                                                     Ellen F. ROSENBLUM,
                                                Attorney General, State of Oregon,
                                                           Respondent.
                                                       (S063527 (Control))
                                                        Paul R. ROMAIN,
                                                            Petitioner,
                                                                 v.
                                                     Ellen F. ROSENBLUM,
                                                Attorney General, State of Oregon,
                                                           Respondent.
                                                            (S063531)

                                      En Banc
   On petition to review ballot title filed September 3, 2015;
considered and under advisement November 3, 2015.
   Steven C. Berman, Stoll Stoll Berne Lokting & Shlachter,
PC, Portland, filed the petition and reply for petitioner
Blosser.
   Paul R. Romain, The Romain Group, LLC, Portland, filed
the petition and reply for petitioner Romain.
    Matthew J. Lysne, Assistant Attorney General, Salem,
filed the answering memorandum for respondent. With him
on the memorandum were Ellen F. Rosenblum, Attorney
General, and Paul L. Smith, Deputy Solicitor General.
                                      BALDWIN, J.
  The ballot title is referred to the Attorney General for
modification.
     Case Summary: Petitioners sought review of the Attorney General’s cer-
tified ballot title for Initiative Petition 45 (2016), which, if enacted, would
amend several aspects of a bill that the legislature enacted during the 2015
296	                          Blosser/Romain v. Rosenblum (IP 45)

legislative session relating to the authority of the Oregon Environmental Quality
Commission to adopt standards and requirements to reduce greenhouse gas
emissions. Petitioners argued that the caption, the “yes” and “no” result state-
ments, and the summary do not substantially comply with requirements set out
in ORS 250.035(2). Held: The certified caption and “yes” result statement do not
substantially comply with statutory requirements.
    The ballot title is referred to the Attorney General for modification.
Cite as 358 Or 295 (2015)	297

	        BALDWIN, J.
	        In these consolidated cases, petitioners seek review
of the Attorney General’s certified ballot title for Initiative
Petition 45 (2016) (IP 45), contending that the caption, the
“yes” and “no” result statements, and the summary do not
comply with requirements set out in ORS 250.035(2). We
review the certified ballot title to determine whether it
substantially complies with those requirements. See ORS
250.085(5) (setting out that standard). For the reasons
explained below, we refer the ballot title to the Attorney
General for modification of the caption and the “yes” result
statement.
	        IP 45, which is appended to this opinion, is a pro-
posed statute that would amend aspects of a bill that the
legislature enacted during the 2015 legislative session,
Senate Bill (SB) 324 (2015), Or Laws 2015, ch 4. SB 324
made changes to a 2009 state law that permitted the Oregon
Environmental Quality Commission (EQC) to adopt stan-
dards and requirements to reduce greenhouse gas emis-
sions, and to adopt low carbon fuel standards for gasoline,
diesel, and alternative fuels, as well as a schedule to reduce
by 2020 the average amount of greenhouse gas emissions
by 10 percent below 2010 levels. Or Laws 2009, ch 754,
§§ 3(2), 6(2)(a), 6(2)(b). SB 324 changed the EQC’s general
permissive authority to adopt low carbon fuel standards to
a directive, but left in place the EQC’s permissive authority
to adopt a schedule for reducing greenhouse gas emissions,
newly extended to 2025. Or Laws 2015, ch 4, §§ 3(2)(a),
3(2)(b)(A). SB 324 further directed the EQC to adopt rules
to manage and contain the cost of compliance with the
standards, expressly permitting alternative compliance by
obtaining and trading credits for fuels used as substitutes
for gasoline or diesel. Id. § 3(2)(d).
	         IP 45 would change parts of the original 2009 law
and SB 324. First, IP 45 would limit application of the state’s
low carbon fuel standards to blended liquid fuels. IP 45,
§ 1(1)(b). IP 45 further bases its definition of “low carbon fuel
standards” on the blending of liquid fuel “available in com-
mercial quantities” in Oregon and provides that its “carbon
intensity” reduction adjustments can occur only if the EQC
298	                   Blosser/Romain v. Rosenblum (IP 45)

determines that “sufficient” low carbon intensity fuels are
“available in commercial quantities.” Id. §§ 1(1)(d), 1(2)(b)(A),
1(4).
	        Second, IP 45 would eliminate the EQC’s permissive
authority to adopt a schedule to reduce greenhouse gas emis-
sions by 10 percent by 2025, replacing that provision with a
directive to adopt a schedule to phase in a five-percent car-
bon intensity reduction for gasoline and diesel. Id. §§ 1(1)(b),
1(2)(b)(A). That schedule reduction under IP 45, as well
as the development of low carbon fuel standards, would
require the EQC to assess whether alternative liquid fuels
are “available in commercial quantities.” Id. §§ 1(1)(b), 1(4).
That assessment, in turn, relies on a particularly described
analysis, including whether low carbon intensity fuels are
“cost competitive;” that is, whether such fuels are available
at a cost less than or equal to “base petroleum products”
(gasoline and diesel). Id. § 1(4)(b). The EQC’s “available in
commercial quantities” analysis also would incorporate the
following determinations: (1) whether low carbon intensity
fuel facilities inside and outside Oregon are capable of pro-
viding such fuels in commercial quantities, depending on
consideration of multiple factors, id. § 1(4)(a); (2) whether
the infrastructure to distribute low carbon intensity fuels
is sufficient, id. § 1(4)(c); and (3) whether sufficient com-
mercially produced vehicles exist to utilize such fuels, id.
§ 1(4)(d).
	        Third, “[a]s a means for containing the costs of com-
pliance with the standards,” IP 45 would require the EQC to
adopt rules for blending liquid fuels. Those rules would be
subject to a restriction on the amount of ethanol or biodiesel
that may be used in creating blended fuels and also to a
prohibition against requiring the blending of any low carbon
intensity fuel that is not available at an average retail cost
equal to or less than gasoline or diesel. Id. § 1(2)(c).
	       Finally, IP 45 would eliminate the cost-containment
provision of SB 324, which, in addition to expressly requir-
ing the EQC to adopt cost-containment rules, also permits
alternative compliance with the standards by obtaining and
trading fuel credits. Id. § 1(2) (eliminating paragraph (d)
from SB 324, Or Laws 2015, ch 4, § 3(2)(d)).
Cite as 358 Or 295 (2015)	299

	         The Attorney General drafted a ballot title for IP 45,
ORS 250.065(3), and the Secretary of State circulated that
title for public comment, ORS 250.067(1). After receiving
comments, the Attorney General modified its draft ballot
title, ORS 250.067(2)(a), and certified the following ballot
title to the Secretary of State:
          “Restricts low carbon fuel standards to
          requiring blending gasoline/diesel with
                  other fuels; other limits
   “Result of ‘Yes’ Vote:  ‘Yes’ vote limits low carbon fuel
   standards’ carbon reduction requirements; restricts stan-
   dards to requiring gasoline/diesel blends with commer-
   cially available fuels; eliminates fuel credit system.
   “Result of ‘No’ Vote:  ‘No’ vote retains low carbon fuel
   standards for liquid, non-liquid transportation fuels; stan-
   dards allow obtaining fuel credits to satisfy standards,
   require rules to control costs.
   “Summary:  Currently, Environmental Quality Commis-
   sion sets low carbon fuel standards for gasoline, diesel,
   other fuels; may reduce average greenhouse gas emis-
   sions per unit of energy by 10% below 2010 levels by 2025.
   Commission must adopt rules to control costs, must allow
   compliance by obtaining credits from lower carbon fuel
   providers. Measure restricts low carbon fuel standards to
   requiring blending of gasoline or diesel with other liquid
   fuels; standards inapplicable to non-liquid fuels; eliminates
   credit system. Measure further provides that adopted stan-
   dards cannot require carbon reductions greater than 5%
   from 2010 levels; cannot require any reductions unless low
   carbon fuel needed for blending requirements is ‘available
   in commercial quantities’ (defined), costs no more than the
   gasoline or diesel into which it is blended. Other provisions.”
	        Petitioners are electors who timely submitted com-
ments about the Attorney General’s draft ballot title and
who now are dissatisfied with the certified ballot title, ORS
250.085(2). Petitioner Blosser challenges aspects of the
“yes” result statement and the summary added after the
comment period ended. See ORS 250.085(6) (permitting
Supreme Court consideration of such arguments). Petitioner
Romain challenges all aspects of the ballot title, consistently
with his earlier comments and adding challenges to aspects
of the ballot title made after the comment period ended.
300	                         Blosser/Romain v. Rosenblum (IP 45)

	        We begin with petitioner Romain’s challenge to the
caption. He argues that the caption is misleading because
it addresses only the liquid fuels restriction in IP 45 and
otherwise groups all the other significant changes into
a single category, “other limits.” In his view, the caption
instead should separately highlight the elimination of fuel
credits and the new requirement that alternative fuels be
available in commercial quantities. The Attorney General
responds that the subject matter of IP 45 is the “fundamen-
tal legal change in the scope and breadth of the low carbon
fuel standards”—that is, the new limited application of the
standards to blended liquid fuels only—and that the other
components that petitioner Romain notes are part of that
broader change that need not be included in the caption.
	         Under ORS 250.035(2)(a), the caption is limited to
15 words and must “reasonably identif[y] the subject mat-
ter” of IP 45—that is, its “actual major effect” or, if more
than one major effect, all effects that can be described within
the available word limit. Lavey v. Kroger, 350 Or 559, 563,
258 P3d 1194 (2011). We agree with petitioner Romain that
the elimination of the fuel credits provision, which SB 324
enacted as a new, alternative means of complying with state
low carbon fuel standards, is an actual major effect of IP 45
that should be noted in the caption. The elimination of that
provision would eliminate both the ability of the EQC to cre-
ate a state fuel credits program and the ability of regulated
persons to alternatively comply with the EQC’s standards
by obtaining and trading fuel credits. The Attorney General
therefore must modify the caption to refer to the elimination
of fuel credits.1
	        Petitioner Romain further argues that the caption
should specifically note the requirement that, before the
low carbon fuel standards can apply, alternative fuels must
be “available in commercial quantities.” IP 45, § 1(2)(b)(A).
Petitioner Blosser, however, asserts in his argument chal-
lenging the “yes” result statement that the short-hand phrase

	1
       By way of example, although the Attorney General potentially could draft
the caption in many ways to comply with ORS 250.035(2)(a), one possible way
would be: “Limits low carbon fuel standards to gasoline/diesel liquid blends;
eliminates fuel credits; other limits.”
Cite as 358 Or 295 (2015)	301

“commercially available,” as used in the “yes” result state-
ment is misleading standing alone and that additional
words are needed to accurately convey the intended mean-
ing of the phrase “available in commercial quantities,”
IP 45, § 1(2)(b)(A). For the reasons explained below address-
ing petitioner Blosser’s challenge to the “yes” result state-
ment, we disagree with petitioner Romain that the 15-word
caption must separately describe the “available in commer-
cial quantities” limitation in IP 45. Instead, we agree with
the Attorney General that the caption’s more general ref-
erence to “other limits” substantially complies with ORS
250.035(2)(a).
	         We turn to petitioner Blosser’s challenge to the
“yes” result statement, which focuses on the words “commer-
cially available.” As described earlier, IP 45 provides that its
“carbon intensity” reduction adjustments can occur only if
the EQC determines that “sufficient” low carbon intensity
fuels to be blended with gasoline or diesel are “available in
commercial quantities,” and IP 45 similarly limits applica-
tion of other provisions by use of the defined term “available
in commercial quantities.” IP 45, §§ 1(1)(d), 1(2)(b)(A), 1(4).
The “yes” result statement describes those provisions using
the phrase “restricts standards to requiring gasoline/diesel
blends with commercially available fuels” (emphasis added).
Petitioner Blosser contends that the shorthand reference
“commercially available” is misleading: Electors would
understand those words to describe low carbon intensity
fuels that can be obtained for money in an open, legal mar-
ketplace, but IP 45 specifically defines “available in com-
mercial quantities” to mean only such fuels available under
certain cost and other restrictions, and thus would exclude
fuels that otherwise, in more common parlance, would be
considered to be commercially available.2 The Attorney
General responds that the words “commercially available”

	2
       As noted, IP 45 ties the concept of low carbon intensity fuels “available in
commercial quantities” to the cost of those fuels; only those fuels available at a
cost that is equal to or less than the cost of base petroleum products qualify for
blending with gasoline or diesel. IP 45, § 1(4)(b). Additionally, if infrastructure is
insufficient to distribute low carbon fuels as described in IP 45, or if insufficient
commercially produced vehicles are in existence that utilize such fuels, then those
fuels “will not be considered available in commercial quantities.” Id. §§ 1(4)(c),
1(d). And, as part of determining availability in commercial quantities, IP 45
302	                           Blosser/Romain v. Rosenblum (IP 45)

in the “yes” result statement, when read in context with the
rest of the accompanying phrase, accurately and broadly
identify IP 45’s “most predominant legal restriction” regard-
ing the potential blending of alternative fuels if IP 45 is
approved—that is, its requirement that the alternative fuels
be available in sufficient quantities.
	        Under ORS 250.035(2)(b), the “yes” result state-
ment must set out “[a] simple and understandable state-
ment of not more than 25 words that describes the result” if
the measure is approved. We agree with petitioner Blosser
that the “yes” result statement does not substantially com-
ply with that requirement. As petitioner Blosser notes,
IP 45 defines the term “available in commercial quantities”
as subject to several restrictions—most significantly, an
express cost limitation, such that only low carbon intensity
fuels that are available at a cost equal to or less than the
cost of those base petroleum products may be blended with
gasoline or diesel. Without reference to that qualification,
the words “commercially available” inaccurately—and thus,
impermissibly—convey to voters that the updated standards
under IP 45 would apply as long as the alternative fuels as
described are available for purchase in the marketplace. See
Tauman v. Myers, 343 Or 299, 302-04, 170 P3d 556 (2007)
(demonstrating that term taken directly from proposed
measure can impermissibly confuse voters if used in ballot
title, when measure defines term differently from commonly
understood meaning); Sager v. Myers, 328 Or 528, 531-33,
982 P2d 1104 (1999) (same).3
	        Petitioner Romain raises a different challenge to the
“yes” result statement, arguing that the phrase “limits low
carbon fuel standards’ carbon reduction requirements” is

requires the EQC to apply a multi-factored analysis to determine the capabil-
ity of low carbon intensity fuel facilities. See IP 45 §§ 1(4)(a)(A)-(J) (setting out
factors).
	3
       The Attorney General argues that Tauman is inapposite because the pro-
posed measure in that case defined a commonly understood term in a uniquely
broad manner, whereas IP 45 defines “available in commercial quantities” in a
uniquely limited manner. See 343 Or at 302-03 (explaining broad definition of
“charity” in proposed measure at issue, in context of addressing challenge to cap-
tion). Tauman, however, expressly focused on the “false impression” conveyed to
voters about the scope of a term in the measure. Id. The Attorney General’s “yes”
result statement for IP 45 suffers from that same deficiency.
Cite as 358 Or 295 (2015)	303

inaccurate because, in operation, the 2009 law as amended
by SB 324 will not actually result in reduced carbon produc-
tion, whereas IP 45 will result in some reduction. Whatever
the merits of that argument as to the respective likely con-
sequences of competing versions of the law, the text of IP 45
expressly changes various provisions of the 2009 law, as
amended by SB 324, to limit the scope of current low car-
bon fuel standards in several respects. The identified phrase
in the Attorney General’s “yes” result statement accurately
describes that text and therefore substantially complies
with ORS 250.035(2)(b). Petitioner Romain’s arguments
are more properly directed toward ultimate efforts to per-
suade voters whether to enact IP 45. See generally Rogers
v. Roberts, 300 Or 687, 692, 717 P2d 620 (1986) (ballot title
should not include speculation as to result or consequence of
proposed measures).
	        Turning to the “no” result statement, petitioner
Romain contends that the phrase “require rules to con-
trol costs” is misleading. He first argues that that phrase
incorrectly implies that IP 45 will eliminate current rules
to control costs, when IP 45 actually retains a 2009 provi-
sion requiring the EQC to evaluate cost-effectiveness and
to minimize the cost of compliance when adopting rules, Or
Laws 2009, ch 754 § 6(3), and IP 45 otherwise requires the
EQC to determine the cost and availability of alternative
fuels as a condition precedent to reduced carbon intensity.
He additionally argues that the phrase “require rules to con-
trol costs” misleadingly implies that the EQC rules adopted
under the 2009 law (as amended by SB 324) will actually
control costs; by contrast, in operation, IP 45—not current
law—will control costs.
	        In response to petitioner Romain’s first argument,
the Attorney General correctly points out that, although
IP 45 would retain the original 2009 provision about the
EQC’s evaluation of several factors in adopting rules, Or
Laws 2009, ch 754 § 6(3), it nonetheless would eliminate
an express provision from the 2009 law (as amended by SB
324), which requires the EQC to “adopt by rule provisions for
managing and containing the costs of compliance with the
[low carbon fuel intensity] standards,” Or Laws 2015, ch 4,
§ 3(2)(d); compare IP 45, § 1(2)(c) (more limited provision,
304	                  Blosser/Romain v. Rosenblum (IP 45)

requiring adoption of rules about blending fuels that would
serve “[a]s a means for containing the costs of compliance
with the standards”). Incorporating the phrase “require rules
to control costs” in the “no” result statement accurately cap-
tures that statement of current law. See ORS 250.035(2)(c)
(“no” result statement must describe, within 25 words, result
if proposed measure is rejected). As to petitioner Romain’s
second argument, the Attorney General responds—and we
agree—that that argument is more appropriately made to
the voters.
	        Both petitioners raise various challenges to the sum-
mary. We have considered those challenges and conclude,
without further discussion, that the summary substantially
complies with the requirements of ORS 250.035(2)(d) (sum-
mary must contain concise and impartial statement not
exceeding 125 words that summarizes measure and major
effect).
	      We refer the ballot title for IP 45 to the Attorney
General for modification of the caption and the “yes” result
statement, as described in this opinion.
	       The ballot title is referred to the Attorney General
for modification.
Cite as 358 Or 295 (2015)	305

                         APPENDIX
Relating to transportation fuel cost containment.
Be It Enacted by the People of the State of Oregon:
	        Section 1.  Section 6, chapter 754, Oregon Laws
2009, as amended by Section 3, chapter 4, Oregon Laws
2015, is amended to read:
	       Sec. 6.  (1)  As used in this section:
	       (a)  “Greenhouse gas” has the meaning given that
term in ORS 468A.210.	
	        (b)  “Low carbon fuel standards” means standards
for the reduction of greenhouse gas emission [on average, per
unit of fuel energy] by the blending of liquid fuel avail-
able in commercial quantities in this state.
	       (c)  “Motor vehicle” has the meaning given that
term in ORS 801.360.
	       (d) “Available in commercial quantities”
means that the liquid fuel must actually be avail-
able in the State of Oregon in sufficient quantities as
determined pursuant to Section 4 of this section for
all persons who import gasoline or diesel to comply
with the standards.
	        (2)(a)  The Environmental Quality Commission
shall adopt by rule low carbon fuel standards for gasoline,
diesel and liquid fuels used as substitutes for gasoline and
diesel.
	       (b)  The commission shall [may] adopt the follow-
ing related to the standards. [, including but not limited
to:]
	        (A)  A schedule to phase in a 5% carbon inten-
sity reduction for gasoline and diesel on average.
[implementation of the standards in a manner that reduces
the average amount of greenhouse gas emissions per unit of
fuel energy of the fuels by 10 percent below 2010 levels by the
year 2025 or by a later date if the commission determines that
an extension is appropriate to implement the standards]; The
schedule shall provide that, beginning January 1,
306	                  Blosser/Romain v. Rosenblum (IP 45)

2016, the first reduction in carbon intensity (“C.I.”) of
gasoline and diesel will be 0.25% from a baseline of
clear gasoline and diesel sold in Oregon during 2010.
Further reductions in C.I. of Oregon liquid fuels will
be implemented over time. The subsequent reduc-
tions, by percent, will be 0.5%, 1.0%, 1.5%, 2.5%, 3.5%,
and 5%. These reductions shall be the average fuel
reduction for all subject fuels sold in Oregon. The
commission’s rules shall provide that a C.I. reduc-
tion adjustment will be made no less than one year
from the last reduction adjustment implemented. The
commission’s rules shall provide that a scheduled C.I.
reduction adjustment shall not be made unless the
commission conducts an analysis pursuant to section
4 of these sections and makes a determination that
sufficient low C.I. biofuel blend stocks are available
in commercial quantities.
	       (B) Standards for greenhouse gas emissions
attributable to the fuels throughout their lifecycles, includ-
ing b[ut] not limited to emissions from the production, stor-
age, transportation and combustion of the fuels and from
changes in land use associated with the fuels.[;]
	         (C)  Provisions allowing the use of all types of
liquid low carbon fuels to meet the low carbon fuel stan-
dards [,including but not limited to biofuels, biogas, natural
gas, liquefied petroleum gas, gasoline, diesel, hydrogen and
electricity];
	       (D)  Standards for the issuance of deferrals, estab-
lished with adequate lead time, as necessary to ensure ade-
quate fuel supplies.[;]
	       (E)  Exemptions for fuels that are used in volumes
below thresholds established by the commission.[;]
	(F)          Standards, specifications, testing requirements
and other measures as needed to ensure the quality of fuels
produced in accordance with the low carbon fuel standards,
including but not limited to the requirements of ORS 646.910
to 646.923 and administrative rules adopted by the State
Department of Agriculture for motor fuel quality. [and]
Cite as 358 Or 295 (2015)	307

	[(G)  Adjustments to the amounts of greenhouse gas
emissions per unit of fuel energy assigned to fuels for combus-
tion and drive train efficiency.]
	[(c)  Before adopting standards under this section,
the commission shall consider the low carbon fuels standards
of other states, including but not limited to Washington, for
the purpose of determining schedules and goals for the reduc-
tion of the average amount of greenhouse gas emissions per
unit of fuel energy and the default values for these reductions
for applicable fuels.]
	       (c)  As a means for containing the costs of
compliance with the standards, the commission
shall adopt by rule provisions for blending liquid
fuels available in commercial quantities in this state.
Provisions adopted under this subparagraph may
not:
	       (A)  Require that any person who imports
gasoline or diesel fuel blend into that fuel more etha-
nol or biodiesel than 10 percent ethanol (E-10) and 5
percent biodiesel (B-5); or
	       (B)  Provide for or require that any person
who imports gasoline or diesel fuel blend into that
fuel any low C.I. fuel that is not available at average
market retail costs equal to or less than the base gas-
oline or diesel.
	[(d)  The commission shall adopt by rule provisions
for managing and containing the costs of compliance with the
standards, including but not limited to provisions to facili-
tate compliance with the standards by ensuring that persons
may obtain credits for fuels used as substitutes for gasoline
or diesel and by creating opportunities for persons to trade
credits.]
	[(e)](d)  The commission shall exempt from the
standards any person who imports in a calendar year less
than 500,000 gallons of gasoline and diesel fuel, in total. Any
fuel imported by persons that are related or share common
ownership or control shall be aggregated together to deter-
mine whether a person is exempt under this paragraph.
308	                   Blosser/Romain v. Rosenblum (IP 45)

	[(f)](e)(A)  The commission by rule shall prohibit
fuels that contain biodiesel from being considered an alter-
native fuel under these standards unless the fuel meets the
following standards:
	       (i)  Fuel that consists entirely of biodiesel, desig-
nated by B100, shall comply with ASTM D 6751 and shall
have an oxidation stability induction period of not less than
eight hours as determined by the test method described in
European standard EN 15751; and
	        (ii)  Fuel that consists of a blend of diesel fuel and
between 6 and 20 volume percent biodiesel, and designated
as biodiesel blends B6 to B20, shall comply with ASTM D
7467 and shall have an oxidation stability induction period
of not less than 20 hours as determined by the test method
described in European standard EN 15751.
	        (B)  The commission may adopt rules different from
those required under subparagraph (A) of this paragraph if
an ASTM or EN standard applicable to biodiesel is approved
or amended after March 12, 2015, or if the commission finds
that different rules are necessary due to changes in technol-
ogy or fuel testing or production methods.
	       (C)  As used in this subsection, “biodiesel” means
a motor vehicle fuel consisting of mono-alkyl esters of long
chain fatty acids derived from vegetable oils, animal fats or
other nonpetroleum resources, not including palm oil.
	       (f)  The commission may not differentiate
among crude oils in determining the life cycle carbon
intensity value for gasoline and diesel.
	      (3)  In adopting rules under this section, the
Environmental Quality Commission shall evaluate:
	       (a)  Safety, feasibility, net reduction of greenhouse
gas emissions and cost-effectiveness;
	        (b)  Potential adverse impacts to public health and
the environment, including but not limited to air quality,
water quality and the generation and disposal of waste in
this state;
	      (c)  Flexible implementation approaches to mini-
mize compliance costs; and
Cite as 358 Or 295 (2015)	309

	       (d)  Technical and economic studies of comparable
greenhouse gas emission reduction measures implemented
in other states and any other studies as determined by the
commission.
	       (4)  The commission shall determine that
there is a sufficient volume of low C.I. fuels available
in commercial quantities in order to approve the next
scheduled reduction adjustment. This determination
shall be based upon the following consideration.
	       (a)  The commission will conduct an analysis
to assess the capability of the low C.I. fuel facilities
within and without the State of Oregon to provide
low C.I. fuels available in commercial quantities. This
analysis shall consider:
	       (A)  Design capacity in gallons per day.
	       (B)  Date of construction and completion.
	       (C)  Date that feedstock was first introduced
to the process.
	      (D) Date that commercial quantities of
on-specification product was first produced. Planned
or advertised dates will not be considered.
	       (E)  Highest utilization demonstrated in a
consecutive three-month period (utilization is defined
as production rate divided by design capacity, inclu-
sive of downtime).
	      (F)  Percent of product that was produced
on-specification, without reprocessing or blending
during the period in Section 4(a)(E) of this section.
	      (G)  Duration, in days, of longest continuous
period of plant operation.
	      (H)  Utilization during the last calendar year
(production rate divided by design capacity, inclusive
of downtime).
	      (I)  Percent of product that was produced
on-specification without reprocessing or blending
during the period in Section 4(a)(H) of this section.
310	                 Blosser/Romain v. Rosenblum (IP 45)

	       (J)  Annual Production forecast for the next
one to three years (high, medium, and low estimates)
based on historic production and any technical
issues to date. The commission shall include varia-
tions based on projected feedstock availability and
any changes to feedstock being used in the process.
	       (b)  The commission shall analyze whether
available low C.I. fuels are cost competitive. If the
fuels are not available at average market retail costs
equal to or less than the base petroleum products, the
low C.I. fuels will not be considered available in com-
mercial quantities.
	       (c)  The Commission shall conduct an analy-
sis to determine the capability of the distribution sys-
tem infrastructure (including retail sites) to handle
the projected volumes and types of fuels. If insuffi-
cient to handle projected volumes and types of low
C.I. fuels, the volume of fuels that would exceed the
distribution system capacity will not be considered
available in commercial quantities.
	       (d)  The commission shall determine whether
there are sufficient commercially produced vehicles
able to utilize the low C.I. fuels following the sched-
uled reduction adjustment. If an insufficient number
of such vehicles are able to utilize the low C.I. [f]uels
following the scheduled reduction adjustment, the
low C.I. fuels will not be considered available in com-
mercial quantities.
	[(4)](5)(a)  The provisions of this section do not
apply to fuel that is demonstrated to have been used in any
of the following:
	       (A)  Motor vehicle registered as farm vehicle under
the provisions of ORS 805.300.
	       (B)  Farm tractors, as defined in ORS 801.265.
	        (C)  Implements of husbandry, as defined in ORS
801.310.
	       (D)  Motor trucks, as defined in ORS 801.355, used
primarily to transport logs.
Cite as 358 Or 295 (2015)	311

	        (E)  Motor vehicles that are not designed primar-
ily to transport persons or property, that are operated on
highways only incidentally, and that are used primarily for
construction work.
	       (F) Watercraft.
	       (G)  Railroad locomotives.
	        (b)  The Environmental Quality Commission shall
adopt by rule standards for persons to qualify for the exemp-
tions provided in this subsection.