HOUSE BILL No. 5005 July 10, 2001, Introduced by Reps. Julian, Birkholz, Ehardt, Richardville, Toy, Pappageorge, Gilbert, Bovin and Jansen and referred to the Committee on Transportation. A bill to amend 1984 PA 44, entitled "Motor fuels quality act," by amending sections 3, 4a, 5, 6, 9i, 10a, and 10b (MCL 290.643, 290.644a, 290.645, 290.646, 290.649i, 290.650a, and 290.650b), section 3 as amended by 2000 PA 206, section 4a as added by 1986 PA 127, and sections 5 and 6 as amended and sections 9i, 10a, and 10b as added by 1993 PA 236. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 3. (1) The director shall establish standards pursuant 2 to this act to ensure the purity and quality of gasoline sold or 3 offered for sale in this state. 4 (2) The director shall establish standards for the amount 5 and type of additives allowed to be included in gasoline. 6 (3) The director shall establish standards for the grading 7 of gasoline, including, but not limited to,leaded subregular03000'01 TJS 2 1with a minimum 87 AKI, leaded regular with a minimum 89 AKI,2leaded premium with a minimum 93 AKI, unleadedsubregular with a 3 minimum 85 AKI,unleadedregular with a minimum 87 AKI and a 4 minimum 82 MON,unleadedmidgrade 88 with a minimum 88 AKI and 5 A minimum 82 MON,unleadedmidgrade 89 with a minimum 89 AKI 6 and a minimum 83 MON,unleadedpremium with a minimum 90 AKI, 7and grades for alcohol fuels. Leaded gasoline with a 94 AKI or8more, and unleaded gasoline with a 91 AKI or more, may be offered9for sale labeled with the minimum AKI number if the gasoline has10been listed with and approved by the department. The leaded gas-11oline with 94 AKI or more shall be labeled as leaded premium fol-12lowed by the approved AKI number, and the unleaded gasoline with1391 AKI or more shall be labeled unleaded premium followed by the14approved AKI number.PREMIUM 91 WITH A MINIMUM 91 AKI, PREMIUM 15 92 WITH A MINIMUM 92 AKI, PREMIUM 93 WITH A MINIMUM 93 AKI, AND 16 PREMIUM 94 WITH A MINIMUM 94 AKI. 17 (4) The director shall establish standards for Reid vapor 18 pressure as specified by the American society for testing and 19 materials, except as otherwise required to conform to federal or 20 state law. The director shall establish the Reid vapor pressure 21 as 9.0 pounds per square inch (psi) for retail outlets during the 22 period beginning June 1 through September 15 of each year, except 23 for dispensing facilities where the director shall establish the 24 Reid vapor pressure as 7.8 psi in the year 1996 and thereafter. 25 As used in this subsection and section 10d, "Reid vapor pressure" 26 means the vapor pressure of gasoline or gasoline oxygenate blend 27 as determined by ASTM test method D323, standard test method for 03000'01 3 1 vapor pressure of petroleum products (Reid method) or test method 2 D4953, standard test method for vapor pressure of gasoline and 3 gasoline oxygenate blends (dry method). 4 (5) In establishing additive and grading standards the 5 director shall adopt the latest standards for gasoline estab- 6 lished by the American society for testing and materials and 7 shall adopt the latest standards for gasoline established by fed- 8 eral law or regulation. The standards established by the direc- 9 tor shall not prohibit a gasoline blend that is permitted by a 10 valid waiver granted by the United States environmental protec- 11 tion agency pursuant to the fuel or fuel additive waiver in sec- 12 tion 211(f)(4) of part A of title II of the clean air act, chap- 13 ter 360, 81 Stat. 502, 42 U.S.C. 7545, and the ethanol waiver of 14 1.0 psi in section 211(h)(4) of part A of title II of the clean 15 air act, chapter 360, 81 Stat. 502, 42 U.S.C. 7545, if the gaso- 16 line blend meets all of the conditions set forth in the waiver. 17 Beginning June 1, 2003, the director shall not permit the use of 18 the additive methyl tertiary butyl ether (MTBE) in this state. 19 The director, in consultation with the department of environmen- 20 tal quality, shall determine if the additive is likely to cause 21 harmful effects on the environment or public health within the 22 state. By June 1, 2002, the director, in consultation with the 23 director of the department of environmental quality, shall review 24 the status of the use of MTBE in this state. The review shall 25 include the following: 26 (a) The amount of the additive methyl tertiary butyl ether 27 (MTBE) currently in use in gasoline in this state. 03000'01 4 1 (b) An estimate of the amount of MTBE that is imported in 2 gasoline transported into this state from other states or 3 countries. 4 (c) Recommendations as to whether the June 1, 2003 prohibi- 5 tion can be achieved and, if not, determine a more feasible 6 date. 7 (d) Any other information considered appropriate. 8 (6) Standards established pursuant to this section shall be 9 by rules promulgated pursuant to the administrative procedures 10 act of 1969, 1969 PA 306, MCL 24.201 to 24.328. 11 Sec. 4a. A storage tank at a retail outlet shall be period- 12 ically tested BY THE RETAIL DEALER to insure that the tank does 13 not have water or water-alcohol at the bottom of that tank in an 14 amount greater than 2 inches. If there is more than 2 inches of 15 water or water-alcohol at the bottom of the storage tank, gaso- 16 line shall not be sold to a consumer from that tank until the 17 water or water-alcohol level is reduced to a level of less than 2 18 inches. Adequate testing supplies, as determined by the depart- 19 ment, shall be maintained at the retail outlet and shall also be 20 made available to the department to determine the water or 21 water-alcohol level in the storage tank. The department may 22 promulgate rules pursuant to the administrative procedures act of 23 1969,Act No. 306 of the Public Acts of 1969, being sections2424.201 to 24.328 of the Michigan Compiled Laws1969 PA 306, MCL 25 24.201 TO 24.328, to implement this section. 26 Sec. 5. (1) Except as provided by federal law or 27 regulation, in the manufacture of gasoline at any refinery in 03000'01 5 1 this state, a refiner shall not manufacture gasoline at a 2 refinery in this state unless the gasoline meets the requirements 3 in section 3. Except as provided by federal law or regulation, a 4 blender shall not blend gasoline unless the finished blend meets 5 the requirements in section 3. 6 (2) Except as provided by federal law or regulation, a dis- 7 tributor shall not sell or transfer to any distributor, retail 8 dealer, or bulk purchaser-end user any gasoline unless that gaso- 9 line meets the requirements in section 3. 10 (3) A carrier or an employee or agent of a carrier, whether 11 operating under contract or tariff, shall not cause gasoline 12 tendered to the carrier for shipment or transfer to another car- 13 rier, distributor, or retail dealer to fail to comply, at the 14 time of delivery, with the requirements in section 3. 15 (4) A person shall not knowingly sell, dispense, or offer 16 for sale gasoline unless that gasoline meets the requirements in 17 section 3. 18 (5) A refiner or distributor shall not transfer, sell, dis- 19 pense, or offer gasoline for sale in this state to a distributor 20 unless the refiner or distributor indicates on each bill, 21 invoice, or other instrument evidencing a delivery of gasoline, 22 the nameand wholesale distributors license number issued pursu-23ant to Act No. 150 of the Public Acts of 1927, being sections24207.101 to 207.202 of the Michigan Compiled Laws,of the whole- 25 sale distributor who received delivery of the gasoline. 26 (6) A distributor or refiner shall not transfer, sell, 27 dispense, or offer gasoline for sale in this state to a retail 03000'01 6 1 dealer unless the distributor indicates on each bill, invoice, or 2 other instrument evidencing a delivery of gasoline, the name and 3 license number issued pursuant to this act, of the retail dealer 4 who received delivery of the gasoline. 5 (7) A bill, invoice, or other instrument evidencing a deliv- 6 ery of gasoline issued by a refiner or distributor for deliveries 7 of gasoline to purchasers who are not required to hold a license 8 issued pursuant toAct No. 150 of the Public Acts of 1927THE 9 MOTOR FUEL TAX ACT, 2000 PA 403, MCL 207.1001 TO 207.1170, or 10 this act shall clearly indicate the name and address and other 11 information necessary to identify the purchaser of the gasoline. 12 (8) A bill, invoice, or other instrument evidencing a deliv- 13 ery of gasoline required by subsection (5), (6), or (7) shall 14 include a guarantee that the gasoline delivered meets the 15 requirements in section 3 and shall indicate the concentration 16 range of alcohol in the gasoline, except for alcohols or ethers 17 that have a molecular weight greater than ethanol and are not 18 mixed with methanol or ethanol, or both, and shall indicate the 19 possible presence, without regard to concentration range, of any 20 alcohols or ethers that have a molecular weight greater than eth- 21 anol and are not mixed with methanol or ethanol, or both. 22 (9) A refiner, distributor, bulk purchaser-end user, or 23 retail dealer shall not transfer, sell, dispense, or offer gaso- 24 line for sale unless that gasoline is visibly free of undissolved 25 water, sediments, and other suspended matter and is clear and 26 bright at an ambient temperatureofOR 70 degrees Fahrenheit, 27 WHICHEVER IS GREATER. 03000'01 7 1 (10) A person who violates this section or rules promulgated 2 under this section is liable for a civil fine not to exceed 3 $10,000.00 for eachand everyday of the continuance of the 4 violation. A civil fine ordered pursuant to this section shall 5 be submitted to the state treasurer for deposit in the gasoline 6 inspection and testing fund created by section 8. 7 Sec. 6. (1) Before a distributor or retail dealer engages 8 in transferring, selling, dispensing, or the offering for sale 9 gasoline in this state, the distributor or retail dealer shall 10 obtain a license from the department for each retail outlet oper- 11 ated by that person. In administering the licensing under this 12 section, the department may attempt to coordinate such licensing 13 with the licensing applicable to gasoline administered by the 14 department of treasury pursuant toAct No. 150 of the Public15Acts of 1927, being sections 207.101 to 207.202 of the Michigan16Compiled LawsTHE MOTOR FUEL TAX ACT, 2000 PA 403, MCL 207.1001 17 TO 207.1170, and the general sales tax act,Act No. 167 of the18Public Acts of 1933, being sections 205.51 to 205.78 of the19Michigan Compiled Laws1933 PA 167, MCL 205.51 TO 205.78. 20 (2) A license expires annually on November 30 unless renewed 21 before December 1 of each year or unless suspended, denied, or 22 revoked by the department. 23 (3) The fee for a license is$15.00$100.00 for each year 24 or portion of a year. A license shall not be issued or renewed 25 until the feeisAND ANY ADMINISTRATIVE FINES ISSUED UNDER SEC- 26 TION 10A HAVE BEEN paid. A hearing is not requiredprior to27 BEFORE the refusal to issue orreviewRENEW a license under 03000'01 8 1 this subsection. Fees collected shall be deposited in the 2 gasoline inspection and testing fund. 3 (4) An application for a license shall be made to the 4 department upon a form furnished by the department. The com- 5 pleted form shall contain the information requested by the 6 department and shall be accompanied by the fee specified in sub- 7 section (3). 8 (5) The director may suspend, deny, or revoke a license 9 issued pursuant to this act for failure to comply with the 10 requirements provided for in section 3, for failure to provide 11 notice as provided in section 4, for violating section 31 of the 12 weights and measures act of 1964,Act No. 283 of the Public Acts13of 1964, being section 290.631 of the Michigan Compiled Laws14 1964 PA 283, MCL 290.631, if that violation occurs at any of the 15 licensee's retail outlets and involves the transferring, selling, 16 dispensing, or the offering for sale of gasoline in this state, 17 or for otherwise failing to comply with this act or a rule 18 promulgated under this act or an order issued under this act. 19 (6) This section does not apply until June 29, 1985. 20 (7) If a person licensed under this act is convicted of a 21 willful violation under section 31 of the weights and measures 22 act of 1964,Act No. 283 of the Public Acts of 19641964 PA 23 283, MCL 290.631, any license issued pursuant to this act shall 24 be revoked for 2 years. 25 (8) A suspension, revocation, or denial of a license of a 26 person who is an individual shall result in the suspension, 27 revocation, or denial of any other license held or applied for by 03000'01 9 1 that individual under this act. The license of a corporation, 2 partnership, or other association shall be suspended when a 3 license or license application of a partner, trustee, director, 4 or officer, member, or a person exercising control of the corpo- 5 ration, partnership, or other association is suspended, revoked, 6 or denied. The suspension shall remain in force until the direc- 7 tor determines that the disability created by the suspension, 8 revocation, or denial has been removed. 9 (9) Before a blender engages in the transferring, selling, 10 dispensing, or offering for sale blended gasoline in this state, 11 the blender shall register the finished product with the depart- 12 ment and provide to the department test results as the department 13 considers necessary. If the product does not comply with the 14 requirements of section 3, the blender shall provide the depart- 15 ment with a written list of the business names and addresses to 16 whom the blended product is sold. 17 Sec. 9i. (1) A dispensing facility constructed after 18 November 15, 1990, shall obtain a dispensing permit.from the19department within 180 days of the effective date of this20section. A dispensing facility dispensing 100,000 gallons or21more of gasoline a month shall obtain a dispensing permit from22the department within 1 year of the effective date of this23section. A dispensing facility dispensing less than 100,000 gal-24lons of gasoline a month shall obtain a dispensing permit from25the department within 2 years of the effective date of this26section.The fee for a dispensing permit is $25.00 for each year 27 or portion of a year. 03000'01 10 1 (2) Before a dispensing permit is issued, a dispensing 2 facility shall install an approved stage I and, IF REQUIRED, 3 stage II vapor-recovery system and, in addition to the fee for 4 the dispensing permit, shall pay a registration fee for each dis- 5 pensing unit located at the dispensing facility. A permit shall 6 not be issued or renewed until all fees AND ADMINISTRATIVE FINES 7 ISSUED UNDER SECTION 10A are paid. A hearing shall not be 8 requiredprior toBEFORE the refusal to issue or renew a permit 9 under this subsection. 10 (3) A dispensing permit expires annually on November 30 11 unless renewed before December 1 of each year or unless sus- 12 pended, denied, or revoked by the department. Application for a 13 dispensing permit shall be made on a form furnished by the 14 department. The completed form shall contain the information 15 requested by the department and shall be accompanied by the fees 16 specified. 17 (4) The director may suspend, deny, or revoke a dispensing 18 permit issued pursuant to this act for failure to pay the fee 19 required by subsection (1) or (2), or for failure to comply with 20 the requirements of sections 9a to 10c. 21 (5) A fee shall be charged to the operator of stage I and 22 stage II vapor-recovery or gasoline-dispensing equipment for its 23 inspection if any of the following occur: 24 (a) The inspection is a reinspection of equipment that has 25 already been tested and found to contain a substantial defect as 26 defined under section 9c. 03000'01 11 1 (b) The inspection is performed at the request of the 2 operator. 3 (6) The department shall establish the fees and expenses for 4 special services, including the fee for an operator requested 5 inspection or reinspection, for registrations, for training 6 courses, and for accreditation of a trainer, to provide that each 7 fee is sufficient to cover the cost of an operator requested 8 inspection, reinspection, registration, training, or trainer 9 accreditation, respectively, and that the aggregate of all fees 10 collected is sufficient to pay for all salaries and other 11 expenses connected with the activity. The department shall 12 review and adjust the fees at the end of each year and have all 13 fees approved by the director before they are adopted. Fees col- 14 lected under this section shall be deposited in the gasoline 15 inspection and testing fund and reserved for conducting the 16 vapor-recovery program. 17 Sec. 10a. (1) A person who individually, or by the action 18 of his or her agent or employee, or as the agent or employee of 19 another violates this act or a rule promulgated under this act is 20 subject to an administrative fine. Upon the request of a person 21 to whom an administrative fine is issued, the director shall con- 22 duct a hearing conducted pursuant to the administrative proce- 23 dures act of 1969,Act No. 306 of the Public Acts of 1969, being24sections 24.201 to 24.328 of the Michigan Compiled Laws1969 PA 25 306, MCL 24.201 TO 24.328. A fine authorized by this section 26 shall be as follows: 03000'01 12 1 (a) For a first violation, not less than$50.00$100.00 or 2 more than$100.00$200.00, plus actual costs of the 3 investigation and DOUBLE the amount of any economic benefit asso- 4 ciated with the violation. 5 (b) For a second violation within 2 yearsofAFTER the 6 first violation, not less than$100.00$200.00 or more than 7$250.00$500.00, plus actual costs of the investigation and 8 DOUBLE the amount of any economic benefit associated with the 9 violation. 10 (c) For a third violation within 2 yearsfromAFTER the 11 date of the first violation, not less than$250.00$500.00 or 12 more than$500.00$1,000.00, plus actual costs of the investiga- 13 tion and DOUBLE the amount of any economic benefit associated 14 with the violation. 15 (2) A decision of the director under this section is subject 16 to judicial review as provided by law. 17 (3) The director shall advise the attorney general of the 18 failure of any person to pay an administrative fine imposed under 19 this section. The attorney general shall bring an action in 20 court of competent jurisdiction to recover the fine. 21 (4) Any administrative fine, costs, and the recovery of any 22 economic benefit associated with a violation collected under this 23 section shall be paid to the state treasury and deposited into 24 the gasoline inspection and testing fund. 25 Sec. 10b. (1) A person who individually, or by the action 26 of his or her agent or employee, or as the agent or employee of 27 another, performs any of the following is guilty of a misdemeanor 03000'01 13 1 punishable by imprisonment for not more than 90 days, or a fine 2 of not less than $1,000.00 or more than $2,000.00, or both: 3 (a) Renders less effective or inoperable any part of a stage 4 I or stage II vapor-recovery system. 5 (b) Makes a false statement, representation, or certifica- 6 tionin anyON AN application, report, plan, LABEL, or other 7 document that is required to be maintained under this act or 8 rules promulgated under this act. 9 (c) Fails to disclose to the department any knowledge or 10 information relating to or observation of any modification of a 11 stage I or stage II vapor-recovery system which makes the system 12 less effective or inoperable, or falsification of records 13 required to be maintained under this act or rules promulgated 14 under this act. 15 (d) Removes a tag, seal, or mark placed on a dispensing 16 device by the director. 17 (e) Violates this act or a rule promulgated under this act 18 for which a specific penalty is not prescribed. 19 (2) A person who individually, or by the action of his or 20 her agent or employee, or as the agent or employee of another, 21 performs any of the following acts is guilty of a misdemeanor 22 punishable by imprisonment for not more than 90 days, or a fine 23 of not less than $2,000.00 or more than$5,000.00$10,000.00, 24 or both: 25 (a) Violates a prohibited act listed in this section within 26 24 monthsofAFTER another violation of this section that 27 results in a conviction. 03000'01 14 1 (b) Impersonates in any way the director or any department 2 inspector. 3 (3) A person who individually, or by the action of his or 4 her agent or employee, or as the agent or employee of another, 5 performs any of the following acts is guilty of a felony punish- 6 able by imprisonment for not more than 2 years, or a fine of not 7 less than$5,000.00$10,000.00 or more than$10,000.008 $15,000.00, or both: 9 (a) Intentionally commits a prohibited act under this 10 section. 11 (b) Violates a prohibited act listed in this section within 12 24 monthsofAFTER 2 previous violations of this section that 13 result in convictions. 14 (4) If a violation of this section results in a conviction, 15 the court shall assess against the defendant the costs of the 16 department's investigation, and these costs shall be paid to the 17 state treasury and deposited in the gasoline inspection and test- 18 ing fund to be used for the enforcement of this act. 03000'01 Final page. TJS