1.1    .................... moves to amend H. F. No. 2987, the first engrossment, as follows:
1.2Delete everything after the enacting clause and insert:

1.3    "Section 1. Minnesota Statutes 2006, section 239.77, as amended by Laws 2007,
1.4chapter 62, sections 3 and 4, is amended to read:
1.5239.77 BIODIESEL CONTENT MANDATE.
1.6    Subdivision 1. Biodiesel fuel. "Biodiesel fuel" means a renewable, biodegradable,
1.7mono alkyl ester combustible liquid fuel that is derived from agricultural and other
1.8plant oils or animal fats and; that meets American Society For Testing and Materials
1.9specification D6751-07 for Biodiesel Fuel (B100) Blend Stock for Distillate Fuels;
1.10and that is manufactured by a person certified by the BQ-9000 National Biodiesel
1.11Accreditation Program.
1.12    Subd. 2. Minimum content. (a) Except as otherwise provided in this section, all
1.13diesel fuel sold or offered for sale in Minnesota for use in internal combustion engines
1.14must contain at least 2.0 percent the stated percentage of biodiesel fuel oil by volume.
1.15on and after the following dates:

1.16	(1)	September 29, 2005	2 percent
1.17	(2)	May 1, 2009	5 percent
1.18	(3)	May 1, 2012	10 percent
1.19	(4)	May 1, 2015	20 percent

1.20    The minimum content levels in clauses (3) and (4) are effective during the months
1.21of April, May, June, July, August, September, October only. The minimum content for
1.22the remainder of the year is five percent. However, if the commissioners of agriculture,
1.23commerce, and pollution control determine, after consultation with the biodiesel task
1.24force and other technical experts, that an American Society for Testing and Materials
1.25specification or equivalent federal standard exists for the specified biodiesel blend level in
1.26those clauses that adequately addresses technical issues associated with Minnesota's cold
2.1weather and publish a notice in the State Register to that effect, the commissioners may
2.2allow the specified biodiesel blend level in those clauses to be effective year-round.
2.3    (b) The minimum content levels in paragraph (a), clauses (3) and (4) become
2.4effective on the date specified only if the commissioners of agriculture, commerce, and
2.5pollution control publish notice in the State Register and provide written notice to the
2.6chairs of the house and senate committees with jurisdiction over agriculture, commerce,
2.7and transportation policy and finance, at least 270 days prior to the date of each scheduled
2.8increase, that all of the following conditions have been met and the state is prepared to
2.9move to the next scheduled minimum content level:
2.10    (1) an American Society for Testing and Materials specification or equivalent federal
2.11standard exists for the next minimum diesel-biodiesel blend;
2.12    (2) a sufficient supply of biodiesel is available and the amount of biodiesel produced
2.13in this state is equal to at least 50 percent of anticipated demand at the next minimum
2.14content level; and
2.15    (3) adequate blending infrastructure and regulatory protocol are in place in order to
2.16promote biodiesel quality and avoid any potential economic disruption.
2.17    (c) The commissioners of agriculture, commerce, and pollution control must consult
2.18with the biodiesel task force when assessing and certifying conditions in paragraph (b),
2.19and in general must seek the guidance of the biodiesel task force regarding biodiesel
2.20labeling, enforcement, and other related issues.
2.21    (d) During a period of biodiesel fuel shortage or a problem with biodiesel quality
2.22that negatively affects the availability of biodiesel fuel, the commissioner of commerce
2.23may temporarily suspend the minimum content requirement in subdivision 2 until there
2.24is sufficient biodiesel fuel, as defined in subdivision 1, available to fulfill the minimum
2.25content requirement.
2.26    (e) By February 1, 2012, and periodically thereafter, the commissioner of commerce
2.27shall determine the wholesale diesel price at various pipeline and refinery terminals in
2.28the region, and the biodiesel price determined after the $1 per gallon federal credit is
2.29subtracted at biodiesel plants in the region. The commissioner shall report wholesale price
2.30differences to the governor who, after consultation with the commissioners of commerce
2.31and agriculture, may by executive order adjust the biodiesel mandate if a price disparity
2.32reported by the commissioner will cause economic hardship to retailers of diesel fuel
2.33in this state. Any adjustment must be for a specified period of time, after which the
2.34percentage of biodiesel fuel to be blended into diesel fuel returns to the amount required in
2.35subdivision 2. The biodiesel mandate must not be adjusted to less than five percent.
3.1    Subd. 3. Exceptions. (a) The minimum content requirement requirements of
3.2subdivision 2 does do not apply to fuel used in the following equipment:
3.3    (1) motors located at an electric generating plant regulated by the Nuclear
3.4Regulatory Commission;
3.5    (2) railroad locomotives; and
3.6    (3) off-road taconite and copper mining equipment and machinery.
3.7    (b) The exemption in paragraph (a), clause (1), expires 30 days after the Nuclear
3.8Regulatory Commission has approved the use of biodiesel fuel in motors at electric
3.9generating plants under its regulation.
3.10    Subd. 4. Disclosure. A refinery or terminal shall provide, at the time diesel fuel
3.11is sold or transferred from the refinery or terminal, a bill of lading or shipping manifest
3.12to the person who receives the fuel. For biodiesel-blended products, the bill of lading or
3.13shipping manifest must disclose biodiesel content, stating volume percentage, gallons of
3.14biodiesel per gallons of petroleum diesel base-stock, or an ASTM "Bxx" designation
3.15where "xx" denotes the volume percent biodiesel included in the blended product. This
3.16subdivision does not apply to sales or transfers of biodiesel blend stock between refineries,
3.17between terminals, or between a refinery and a terminal.

3.18    Sec. 2. Minnesota Statutes 2007 Supplement, section 296A.01, subdivision 8a, is
3.19amended to read:
3.20    Subd. 8a. Biodiesel fuel. "Biodiesel fuel" means a renewable, biodegradable, mono
3.21alkyl ester combustible liquid fuel derived from agricultural plant oils or animal fats
3.22and that meets American Society for Testing and Materials specification D6751-07 for
3.23Biodiesel Fuel (B100) Blend Stock for Distillate Fuels has the meaning given in section
3.24239.77, subdivision 1.

3.25    Sec. 3. PROPOSAL; PETROLEUM INSPECTION FEE REVENUE.
3.26    The commissioners of finance, commerce, and pollution control must develop and
3.27submit to the legislature as part of their next biennial budget request a proposal for
3.28eliminating, to the extent feasible, redundant fuel inspections and dedicating all revenue
3.29from the petroleum inspection fee levied on petroleum products under Minnesota Statutes,
3.30section 239.101, subdivision 3, to the Weights and Measures Division of the Department
3.31of Commerce. All additional funding appropriated to the Weights and Measures Division
3.32under this proposal must be used for increased and enhanced fuel quality assurance
3.33enforcement activities and equipment and for educational activities focused on the
3.34handling, distribution and use of biodiesel fuel.

4.1    Sec. 4. BIO-BASED DIESEL ALTERNATIVES.
4.2    (a) By January 1, 2011, the commissioners of agriculture, commerce and pollution
4.3control shall jointly review the technology, economics and operational characteristics
4.4associated with bio-based diesel alternatives and shall make recommendations concerning
4.5their use in Minnesota to the governor and the chairs of the house and senate committees
4.6with jurisdiction over agriculture and energy finance.
4.7    (b) For the purposes of this section, "bio-based diesel alternatives" means
4.8alternatives to petroleum diesel fuel that are warrantied for use in a standard diesel engine
4.9without modification and derived from a biological resource.

4.10    Sec. 5. APPROPRIATION.
4.11    $1,000,000 is appropriated in fiscal year 2009 from the general fund to the
4.12commissioner of agriculture. $500,000 is for cold-weather biodiesel blending
4.13infrastructure grants to fuel terminals that serve Minnesota. $500,000 shall be used to
4.14support the algae-to-biofuels research project at the University of Minnesota and the
4.15Metropolitan Council."
4.16Amend the title accordingly