1.1                          A bill for an act 
  1.2             relating to motor fuels; updating specifications for 
  1.3             petroleum products; amending Minnesota Statutes 2002, 
  1.4             sections 41A.09, subdivision 2a; 239.761; 239.792; 
  1.5             296A.01, subdivisions 2, 7, 8, 14, 19, 20, 22, 23, 24, 
  1.6             25, 26, 28, by adding a subdivision. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2002, section 41A.09, 
  1.9   subdivision 2a, is amended to read: 
  1.10     Subd. 2a.  [DEFINITIONS.] For the purposes of this section, 
  1.11  the terms defined in this subdivision have the meanings given 
  1.12  them. 
  1.13     (a) "Ethanol" means fermentation ethyl alcohol derived from 
  1.14  agricultural products, including potatoes, cereal, grains, 
  1.15  cheese whey, and sugar beets; forest products; or other 
  1.16  renewable resources, including residue and waste generated from 
  1.17  the production, processing, and marketing of agricultural 
  1.18  products, forest products, and other renewable resources, that: 
  1.19     (1) meets all of the specifications in ASTM specification ~~D~~ 
  1.20  ~~4806-88~~ D4806-01; and 
  1.21     (2) is denatured as specified in Code of Federal 
  1.22  Regulations, title 27, parts 20 and 21. 
  1.23     (b) "Wet alcohol" means agriculturally derived fermentation 
  1.24  ethyl alcohol having a purity of at least 50 percent but less 
  1.25  than 99 percent. 
  1.26     (c) "Anhydrous alcohol" means fermentation ethyl alcohol 
  2.1   derived from agricultural products as described in paragraph 
  2.2   (a), but that does not meet ASTM specifications or is not 
  2.3   denatured and is shipped in bond for further processing. 
  2.4      (d) "Ethanol plant" means a plant at which ethanol, 
  2.5   anhydrous alcohol, or wet alcohol is produced. 
  2.6      Sec. 2.  Minnesota Statutes 2002, section 239.761, is 
  2.7   amended to read: 
  2.8      239.761 [PETROLEUM PRODUCT SPECIFICATIONS.] 
  2.9      Subdivision 1.  [APPLICABILITY.] A person responsible for 
  2.10  the product must meet the specifications in this section.  The 
  2.11  specifications apply to petroleum products processed, held, 
  2.12  stored, imported, transferred, distributed, offered for 
  2.13  distribution, offered for sale or use, or sold in Minnesota. 
  2.14     Subd. 2.  [COORDINATION WITH DEPARTMENTS OF REVENUE AND 
  2.15  AGRICULTURE.] The petroleum product specifications in this 
  2.16  section are intended to match the definitions and specifications 
  2.17  in sections 41A.09 and 296A.01.  Petroleum products named in 
  2.18  this section are defined in section 296A.01. 
  2.19     Subd. 3.  [GASOLINE.] (a) Gasoline that is not blended with 
  2.20  ethanol must not be contaminated with water or other impurities 
  2.21  and must comply with ASTM specification ~~D 4814-96~~ D4814-01.  
  2.22  Gasoline that is not blended with ethanol must also comply with 
  2.23  the volatility requirements in Code of Federal Regulations, 
  2.24  title 40, part 80.  
  2.25     (b) After gasoline is sold, transferred, or otherwise 
  2.26  removed from a refinery or terminal, a person responsible for 
  2.27  the product: 
  2.28     (1) may blend the gasoline with agriculturally derived 
  2.29  ethanol as provided in subdivision 4; 
  2.30     (2) shall not blend the gasoline with any oxygenate other 
  2.31  than denatured, agriculturally derived ethanol; 
  2.32     (3) shall not blend the gasoline with other petroleum 
  2.33  products that are not gasoline or denatured, agriculturally 
  2.34  derived ethanol; 
  2.35     (4) shall not blend the gasoline with products commonly and 
  2.36  commercially known as casinghead gasoline, absorption gasoline, 
  3.1   condensation gasoline, drip gasoline, or natural gasoline; and 
  3.2      (5) may blend the gasoline with a detergent additive, an 
  3.3   antiknock additive, or an additive designed to replace 
  3.4   tetra-ethyl lead, that is registered by the EPA. 
  3.5      Subd. 4.  [GASOLINE BLENDED WITH ETHANOL.] (a) Gasoline may 
  3.6   be blended with up to ten percent, by volume, agriculturally 
  3.7   derived, denatured ethanol that complies with the requirements 
  3.8   of subdivision 5.  
  3.9      (b) A gasoline-ethanol blend must: 
  3.10     (1) comply with the volatility requirements in Code of 
  3.11  Federal Regulations, title 40, part 80; 
  3.12     (2) comply with ASTM specification ~~D 4814-96~~ D4814-01, or 
  3.13  the gasoline base stock from which a gasoline-ethanol blend was 
  3.14  produced must comply with ASTM specification ~~D 4814-96~~ D4814-01; 
  3.15  and 
  3.16     (3) not be blended with casinghead gasoline, absorption 
  3.17  gasoline, condensation gasoline, drip gasoline, or natural 
  3.18  gasoline after the gasoline-ethanol blend has been sold, 
  3.19  transferred, or otherwise removed from a refinery or terminal. 
  3.20     Subd. 5.  [DENATURED ETHANOL.] Denatured ethanol that is to 
  3.21  be blended with gasoline must be agriculturally derived and must 
  3.22  comply with ASTM specification ~~D 4806-95b~~ D4806-01.  This 
  3.23  includes the requirement that ethanol may be denatured only as 
  3.24  specified in Code of Federal Regulations, title 27, parts 20 and 
  3.25  21. 
  3.26     Subd. 6.  [GASOLINE BLENDED WITH NONETHANOL OXYGENATE.] (a) 
  3.27  A person responsible for the product shall comply with the 
  3.28  following requirements: 
  3.29     (1) after July 1, 2000, gasoline containing in excess of 
  3.30  one-third of one percent, in total, of ~~the~~ nonethanol oxygenates 
  3.31  listed in paragraph (b) ~~may~~ must not be sold or offered for sale 
  3.32  at any time in this state; and 
  3.33     (2) after July 1, 2005, gasoline containing any of the 
  3.34  nonethanol oxygenates listed in paragraph (b) ~~may~~ must not be 
  3.35  sold or offered for sale in this state. 
  3.36     (b) The oxygenates prohibited under paragraph (a) are: 
  4.1      (1) methyl tertiary butyl ether, as defined in section 
  4.2   296A.01, subdivision 34; 
  4.3      (2) ethyl tertiary butyl ether, as defined in section 
  4.4   296A.01, subdivision 18; or 
  4.5      (3) tertiary amyl methyl ether. 
  4.6      (c) Gasoline that is blended with ~~an~~ a nonethanol oxygenate 
  4.7   ~~, other than denatured ethanol,~~ must comply with ASTM 
  4.8   specification ~~D 4814-96~~ D4814-01.  Nonethanol oxygenates~~, other~~ 
  4.9   ~~than denatured ethanol,~~ must not be blended into gasoline after 
  4.10  the gasoline has been sold, transferred, or otherwise removed 
  4.11  from a refinery or terminal. 
  4.12     Subd. 7.  [HEATING FUEL OIL.] Heating fuel oil must comply 
  4.13  with ASTM specification ~~D 396-96~~ D396-01. 
  4.14     Subd. 8.  [DIESEL FUEL OIL.] Diesel fuel oil must comply 
  4.15  with ASTM specification ~~D 975-96a~~ D975-01a. 
  4.16     Subd. 9.  [KEROSENE.] Kerosene must comply with ASTM 
  4.17  specification ~~D 3699-96a~~ D3699-01. 
  4.18     Subd. 10.  [AVIATION GASOLINE.] Aviation gasoline must 
  4.19  comply with ASTM specification ~~D 910-96~~ D910-00. 
  4.20     Subd. 11.  [AVIATION TURBINE FUEL, JET FUEL.] Aviation 
  4.21  turbine fuel and jet fuel must comply with ASTM specification ~~D~~ 
  4.22  ~~1655-96c~~ D1655-01. 
  4.23     Subd. 12.  [GAS TURBINE FUEL OIL.] Fuel oil for use in 
  4.24  nonaviation gas turbine engines must comply with ASTM 
  4.25  specification ~~D 2880-96a~~ D2880-00. 
  4.26     Subd. 13.  [E85.] A blend of ethanol and gasoline, 
  4.27  containing at least 60 percent ethanol and not more than 85 
  4.28  percent ethanol, produced for use as a motor fuel in alternative 
  4.29  fuel vehicles as defined in section 296A.01, subdivision 5, must 
  4.30  comply with ASTM specification ~~D 5798-96~~ D5798-99. 
  4.31     Subd. 14.  [M85.] A blend of methanol and gasoline, 
  4.32  containing at least 85 percent methanol, produced for use as a 
  4.33  motor fuel in alternative fuel vehicles as defined in section 
  4.34  296A.01, subdivision 5, must comply with ASTM specification 
  4.35  D5797-96. 
  4.36     Sec. 3.  Minnesota Statutes 2002, section 239.792, is 
  5.1   amended to read: 
  5.2      239.792 [GASOLINE OCTANE.] 
  5.3      Subdivision 1.  [DISCLOSURE.] A manufacturer, hauler, 
  5.4   blender, agent, jobber, consignment agent, importer, or 
  5.5   distributor who sells, delivers, or distributes gasoline or 
  5.6   gasoline-oxygenate blends, shall provide, at the time of 
  5.7   delivery, a bill of lading or shipping manifest to the person 
  5.8   who receives the gasoline.  The bill or manifest must state the 
  5.9   minimum octane of the gasoline delivered.  The stated octane 
  5.10  number must be the average of the "motor method" octane number 
  5.11  and the "research method" octane number as determined by the 
  5.12  test methods in ASTM specification ~~D 4814-96~~ D4814-01, or by a 
  5.13  test method adopted by department rule. 
  5.14     Subd. 2.  [DISPENSER LABELING.] A person responsible for 
  5.15  the product shall clearly, conspicuously, and permanently label 
  5.16  each gasoline dispenser that is used to sell gasoline or 
  5.17  gasoline-oxygenate blends at retail or to dispense gasoline or 
  5.18  gasoline-oxygenate blends into the fuel supply tanks of motor 
  5.19  vehicles, with the minimum octane of the gasoline dispensed.  
  5.20  The label must meet the following requirements: 
  5.21     (a) The octane number displayed on the label must represent 
  5.22  the average of the "motor method" octane number and the 
  5.23  "research method" octane number as determined by the test 
  5.24  methods in ASTM specification ~~D 4814-96~~ D4814-01, or by a test 
  5.25  method adopted by department rule. 
  5.26     (b) The label must be at least 2-1/2 inches high and three 
  5.27  inches wide, with a yellow background, black border, and black 
  5.28  figures and letters. 
  5.29     (c) The number representing the octane of the gasoline must 
  5.30  be at least one inch high. 
  5.31     (d) The label must include the words "minimum octane" and 
  5.32  the term "(R+M)/2" or "(RON+MON)/2." 
  5.33     Sec. 4.  Minnesota Statutes 2002, section 296A.01, 
  5.34  subdivision 2, is amended to read: 
  5.35     Subd. 2.  [AGRICULTURAL ALCOHOL GASOLINE.] "Agricultural 
  5.36  alcohol gasoline" means a gasoline-ethanol blend of up to ten 
  6.1   percent agriculturally derived fermentation ethanol derived from 
  6.2   agricultural products, such as potatoes, cereal, grains, cheese 
  6.3   whey, sugar beets, forest products, or other renewable 
  6.4   resources, that: 
  6.5      (1) meets the specifications in ASTM specification ~~D~~ 
  6.6   ~~4806-95b~~ D4806-01; and 
  6.7      (2) is denatured as specified in Code of Federal 
  6.8   Regulations, title 27, parts 20 and 21. 
  6.9      Sec. 5.  Minnesota Statutes 2002, section 296A.01, 
  6.10  subdivision 7, is amended to read:  
  6.11     Subd. 7.  [AVIATION GASOLINE.] "Aviation gasoline" means 
  6.12  any gasoline that is capable of use for the purpose of producing 
  6.13  or generating power for propelling internal combustion engine 
  6.14  aircraft, that meets the specifications in ASTM specification ~~D~~ 
  6.15  ~~910-96~~ D910-00, and that either: 
  6.16     (1) is invoiced and billed by a producer, manufacturer, 
  6.17  refiner, or blender to a distributor or dealer, by a distributor 
  6.18  to a dealer or consumer, or by a dealer to consumer, as 
  6.19  "aviation gasoline"; or 
  6.20     (2) whether or not invoiced and billed as provided in 
  6.21  clause (1), is received, sold, stored, or withdrawn from storage 
  6.22  by any person, to be used for the purpose of producing or 
  6.23  generating power for propelling internal combustion engine 
  6.24  aircraft. 
  6.25     Sec. 6.  Minnesota Statutes 2002, section 296A.01, 
  6.26  subdivision 8, is amended to read: 
  6.27     Subd. 8.  [AVIATION TURBINE FUEL AND JET FUEL.] "Aviation 
  6.28  turbine fuel" and "jet fuel" mean blends of hydrocarbons derived 
  6.29  from crude petroleum, natural gasoline, and synthetic 
  6.30  hydrocarbons, intended for use in aviation turbine engines, and 
  6.31  that meet the specifications in ASTM specification ~~D~~ 
  6.32  ~~1655-96c~~ D1655-01. 
  6.33     Sec. 7.  Minnesota Statutes 2002, section 296A.01, 
  6.34  subdivision 14, is amended to read: 
  6.35     Subd. 14.  [DIESEL FUEL OIL.] "Diesel fuel oil" means a 
  6.36  petroleum distillate or blend of petroleum distillate and 
  7.1   residual fuels, intended for use as a motor fuel in internal 
  7.2   combustion diesel engines, that meets the specifications in ASTM 
  7.3   specification ~~D 975-96a~~ D975-01A.  Diesel fuel includes number 1 
  7.4   and number 2 fuel oils.  K-1 kerosene is not diesel fuel unless 
  7.5   it is blended with diesel fuel for use in motor vehicles.  
  7.6      Sec. 8.  Minnesota Statutes 2002, section 296A.01, 
  7.7   subdivision 19, is amended to read: 
  7.8      Subd. 19.  [E85.] "E85" means a petroleum product that is a 
  7.9   blend of agriculturally derived denatured ethanol and gasoline 
  7.10  or natural gasoline that typically contains 85 percent ethanol 
  7.11  by volume, but at a minimum must contain 60 percent ethanol by 
  7.12  volume.  For the purposes of this chapter, the energy content of 
  7.13  E85 will be considered to be 82,000 BTUs per gallon.  E85 
  7.14  produced for use as a motor fuel in alternative fuel vehicles as 
  7.15  defined in subdivision 5 must comply with ASTM specification ~~D~~ 
  7.16  ~~5798-96~~ D5798-99. 
  7.17     Sec. 9.  Minnesota Statutes 2002, section 296A.01, 
  7.18  subdivision 20, is amended to read:  
  7.19     Subd. 20.  [ETHANOL, DENATURED.] "Ethanol, denatured" means 
  7.20  ethanol that is to be blended with gasoline, has been 
  7.21  agriculturally derived, and complies with ASTM specification ~~D~~ 
  7.22  ~~4806-95b~~ D4806-01.  This includes the requirement that ethanol 
  7.23  may be denatured only as specified in Code of Federal 
  7.24  Regulations, title 27, parts 20 and 21. 
  7.25     Sec. 10.  Minnesota Statutes 2002, section 296A.01, 
  7.26  subdivision 22, is amended to read:  
  7.27     Subd. 22.  [GAS TURBINE FUEL OIL.] "Gas turbine fuel oil" 
  7.28  means fuel that contains mixtures of hydrocarbon oils free of 
  7.29  inorganic acid and excessive amounts of solid or fibrous foreign 
  7.30  matter, intended for use in nonaviation gas turbine engines, and 
  7.31  that meets the specifications in ASTM specification ~~D 2880-96a~~ 
  7.32  D2880-00. 
  7.33     Sec. 11.  Minnesota Statutes 2002, section 296A.01, 
  7.34  subdivision 23, is amended to read: 
  7.35     Subd. 23.  [GASOLINE.] (a) "Gasoline" means: 
  7.36     (1) all products commonly or commercially known or sold as 
  8.1   gasoline regardless of their classification or uses, except 
  8.2   casinghead gasoline, absorption gasoline, condensation gasoline, 
  8.3   drip gasoline, or natural gasoline that under the requirements 
  8.4   of section 239.761, subdivision 3, must not be blended with 
  8.5   gasoline that has been sold, transferred, or otherwise removed 
  8.6   from a refinery or terminal; and 
  8.7      (2) any liquid prepared, advertised, offered for sale or 
  8.8   sold for use as, or commonly and commercially used as, a fuel in 
  8.9   spark-ignition, internal combustion engines, and that when 
  8.10  tested by the weights and measures division meets the 
  8.11  specifications in ASTM specification ~~D 4814-96~~ D4814-01. 
  8.12     (b) Gasoline that is not blended with ethanol must not be 
  8.13  contaminated with water or other impurities and must comply with 
  8.14  both ASTM specification ~~D 4814-96~~ D4814-01 and the volatility 
  8.15  requirements in Code of Federal Regulations, title 40, part 80. 
  8.16     (c) After gasoline is sold, transferred, or otherwise 
  8.17  removed from a refinery or terminal, a person responsible for 
  8.18  the product: 
  8.19     (1) may blend the gasoline with agriculturally derived 
  8.20  ethanol, as provided in subdivision 24; 
  8.21     (2) must not blend the gasoline with any oxygenate other 
  8.22  than denatured, agriculturally derived ethanol; 
  8.23     (3) must not blend the gasoline with other petroleum 
  8.24  products that are not gasoline or denatured, agriculturally 
  8.25  derived ethanol; 
  8.26     (4) must not blend the gasoline with products commonly and 
  8.27  commercially known as casinghead gasoline, absorption gasoline, 
  8.28  condensation gasoline, drip gasoline, or natural gasoline; and 
  8.29     (5) may blend the gasoline with a detergent additive, an 
  8.30  antiknock additive, or an additive designed to replace 
  8.31  tetra-ethyl lead, that is registered by the EPA. 
  8.32     Sec. 12.  Minnesota Statutes 2002, section 296A.01, 
  8.33  subdivision 24, is amended to read:  
  8.34     Subd. 24.  [GASOLINE BLENDED WITH NONETHANOL OXYGENATE.] 
  8.35  "Gasoline blended with nonethanol oxygenate" means gasoline 
  8.36  blended with ETBE, MTBE, or other alcohol or ether, except 
  9.1   denatured ethanol, that is approved as an oxygenate by the EPA, 
  9.2   and that complies with ASTM specification ~~D 4814-96~~ D4814-01.  
  9.3   Oxygenates, other than denatured ethanol, must not be blended 
  9.4   into gasoline after the gasoline has been sold, transferred, or 
  9.5   otherwise removed from a refinery or terminal. 
  9.6      Sec. 13.  Minnesota Statutes 2002, section 296A.01, 
  9.7   subdivision 25, is amended to read:  
  9.8      Subd. 25.  [GASOLINE BLENDED WITH ETHANOL.] "Gasoline 
  9.9   blended with ethanol" means gasoline blended with up to ten 
  9.10  percent, by volume, agriculturally derived, denatured ethanol.  
  9.11  The blend must comply with the volatility requirements in Code 
  9.12  of Federal Regulations, title 40, part 80.  The blend must also 
  9.13  comply with ASTM specification ~~D 4814-96~~ D4814-01, or the 
  9.14  gasoline base stock from which a gasoline-ethanol blend was 
  9.15  produced must comply with ASTM specification ~~D 4814-96~~ D4814-01; 
  9.16  and the gasoline-ethanol blend must not be blended with 
  9.17  casinghead gasoline, absorption gasoline, condensation gasoline, 
  9.18  drip gasoline, or natural gasoline after the gasoline-ethanol 
  9.19  blend has been sold, transferred, or otherwise removed from a 
  9.20  refinery or terminal.  The blend need not comply with ASTM 
  9.21  specification ~~D 4814-96~~ D4814-01 if it is subjected to a 
  9.22  standard distillation test.  For a distillation test, a 
  9.23  gasoline-ethanol blend is not required to comply with the 
  9.24  temperature specification at the 50 percent liquid recovery 
  9.25  point, if the gasoline from which the gasoline-ethanol blend was 
  9.26  produced complies with all of the distillation specifications. 
  9.27     Sec. 14.  Minnesota Statutes 2002, section 296A.01, 
  9.28  subdivision 26, is amended to read: 
  9.29     Subd. 26.  [HEATING FUEL OIL.] "Heating fuel oil" means a 
  9.30  petroleum distillate, blend of petroleum distillates and 
  9.31  residuals, or petroleum residual heating fuel that meets the 
  9.32  specifications in ASTM specification ~~D 396-96~~ D396-01. 
  9.33     Sec. 15.  Minnesota Statutes 2002, section 296A.01, 
  9.34  subdivision 28, is amended to read: 
  9.35     Subd. 28.  [KEROSENE.] "Kerosene" means a refined petroleum 
  9.36  distillate consisting of a homogeneous mixture of hydrocarbons 
 10.1   essentially free of water, inorganic acidic and basic compounds, 
 10.2   and excessive amounts of particulate contaminants and that meets 
 10.3   the specifications in ASTM specification ~~D 3699-96a~~ D3699-01. 
 10.4      Sec. 16.  Minnesota Statutes 2002, section 296A.01, is 
 10.5   amended by adding a subdivision to read:  
 10.6      Subd. 38a.  [NONETHANOL OXYGENATE.] "Nonethanol oxygenate" 
 10.7   means ETBE or MTBE, as defined in this section, or other alcohol 
 10.8   or ether, except denatured ethanol, that is approved as an 
 10.9   oxygenate by the EPA.