Text: H.R.1514 — 104th Congress (1995-1996)All Information (Except Text)
Public Law No: 104-284 (10/11/1996)
[104th Congress Public Law 284]
[From the U.S. Government Printing Office]
PROPANE EDUCATION AND RESEARCH ACT OF 1996
[[Page 110 STAT. 3370]]
Public Law 104-284
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. <<NOTE: Oct. 11, 1996 - [H.R. 1514]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Propane
Education and Research Act of 1996.>>
SECTION 1. <<NOTE: 15 USC 6401 note.>> SHORT TITLE.
This Act may be cited as the ``Propane Education and Research Act of
SEC. 2. <<NOTE: 15 USC 6401.>> 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. <<NOTE: 15 USC 6402.>> DEFINITIONS.
For the purposes of this Act--
(1) the term ``Council'' means a Propane Education and
Research Council created pursuant to section 4 of this Act;
(2) the term ``industry'' means those persons involved 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
(4) the term ``odorized propane'' means propane which has
had odorant added to it;
(5) the term ``producer'' means the owner of propane 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 C<SUP>3</SUP>H<SUP>8</SUP>, whether
recovered from natural gas or crude oil, and includes liquefied
petroleum gases and mixtures thereof;
[[Page 110 STAT. 3371]]
(7) the term ``public member'' means a member of the
Council, other than a representative of producers or retail
marketers, representing significant users of propane, public
safety officials, academia, the propane research community, or
other groups knowledgeable 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 producers 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 business of such sales; and
(11) the term ``Secretary'' means the Secretary of Energy.
SEC. 4. <<NOTE: 15 USC 6403.>> REFERENDA.
(a) Creation of Program.--The qualified industry organizations may
conduct, at their own expense, a referendum among producers and retail
marketers for the creation of a Propane Education and Research Council.
The Council, if established, shall reimburse the qualified industry
organizations for the cost of the referendum accounting and
documentation. Such referendum shall be conducted by an independent
auditing firm agreed to by the qualified industry 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
representative period. Upon approval of those persons representing 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 marketers representing 35 percent of
the volume of propane in each class, the Council shall, at its own
expense, hold a referendum, to be conducted by an independent auditing
firm selected by the Council, to determine whether the industry favors
termination or suspension of the Council. Termination or suspension
shall not take effect unless it is approved 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
the producer class, or is approved by persons representing more than
two-thirds of the total volume of propane in either such class.
SEC. 5. <<NOTE: 15 USC 6404.>> PROPANE EDUCATION AND RESEARCH COUNCIL.
(a) Selection of Members.--The qualified industry organizations
shall select all retail marketer, public, and producer members of the
Council. The producer organizations shall select the producer members of
the Council, the retail marketer organizations
shall select retail marketer members, and all qualified industry
organizations shall jointly select the public members. Vacancies
[[Page 110 STAT. 3372]]
in unfinished terms of Council members shall be filled in the same
manner as were the original appointments.
(b) Representation.--In selecting members of the Council, the
qualified industry organizations shall give due regard to selecting a
Council that is representative of the industry, including representation
(1) gas processors and oil refiners among producers;
(2) interstate and intrastate operators among retail
(3) large and small companies among producers and retail
marketers, including agricultural cooperatives; and
(4) diverse geographic regions of the country.
(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 organization or other industry trade association. Only one
person at a time from any company or its affiliate may serve on the
(d) Compensation.--Council members shall receive no
compensation for their services, nor shall Council members be reimbursed
for expenses relating to their service, except that public members, upon
request, may be reimbursed for reasonable expenses directly related to
their participation 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 Council 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.-- <<NOTE: Contracts.>> The Council shall develop
programs and projects and enter into contracts or agreements for
implementing 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
propane, 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 agriculture 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
[[Page 110 STAT. 3373]]
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
(h) Priorities.--Issues related to research and development, safety,
education, and training shall be given priority 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 necessary, 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 administrative expenses of
operating the Council (not including costs incurred in the collection of
the assessment pursuant to section 7) plus amounts paid under paragraph
(2) shall not exceed 10 percent of the funds collected in any fiscal
(2) The Council shall annually reimburse the Secretary for costs
incurred by the Federal Government relating 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 proposed
budget to the Secretary and to the Congress. The Secretary may recommend
programs and activities the Secretary considers appropriate.
(l) Records; Audits.--The Council shall keep minutes, books, and
records that clearly reflect all of the acts and transactions of the
Council and make public such information. The books of the Council shall
be audited by a certified 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 Council, all
qualified industry organizations, and to other members of the industry
upon request. The Secretary shall receive notice of meetings and may
require reports on the activities of the Council, as well as reports on
compliance, violations, and complaints regarding the implementation of
(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 includes 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.
[[Page 110 STAT. 3374]]
SEC. 6. <<NOTE: 15 USC 6405.>> ASSESSMENTS.
(a) Amount.--The Council shall set the initial assessment 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 developed 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
(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. Assessments 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 another country is not
subject to the assessment.
(c) Alternative Collection Rules.--The Council may establish an
alternative means of collecting the assessment 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 obligations 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 those of any State
propane education and research council created by State law or
regulation, or similar entity. Such coordination shall include a joint
or coordinated assessment collection process, a reduced
assessment, or an assessment rebate. A reduced assessment or rebate
shall be 20 percent of the regular assessment collected in that State
under this section. Assessment rebates shall be paid only to--
(1) a State propane education and research council created
by State law or regulation that meets requirements established
by the Council for specific programs approved by the
(2) a similar entity, such as a foundation established by
the retail propane gas industry in that State, that meets
requirements established by the Council for specific programs
approved by the Council.
SEC. 7. <<NOTE: 15 USC 6406.>> COMPLIANCE.
The Council may bring suit in Federal court to compel
compliance with an assessment levied by the Council under this Act. A
successful action for compliance under this section may also require
payment by the defendant of the costs incurred by the Council in
bringing such action.
[[Page 110 STAT. 3375]]
SEC. 8. <<NOTE: 15 USC 6407.>> LOBBYING RESTRICTIONS.
No funds collected by the Council shall be used in any manner for
influencing legislation or elections, except that
the Council may recommend to the Secretary changes in this Act or other
statutes that would further the purposes of this Act.
SEC. 9. <<NOTE: 15 USC 6408.>> MARKET SURVEY AND CONSUMER PROTECTION.
(a) Price Analysis.--Beginning 2 years after establishment of the
Council and annually thereafter, the Secretary of Commerce, using only
data provided by the Energy Information Administration and other public
sources, shall prepare and make available to the Council, the Secretary
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 indexed changes in the price of residential electricity,
residential 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 rolling 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 composite 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. <<NOTE: 15 USC 6409.>> 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. <<NOTE: 15 USC 6410.>> 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. <<NOTE: 15 USC 6411.>> 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
market changes and Federal
programs, has had an effect on propane consumers, including residential,
agriculture, process, and nonfuel users of propane. The
[[Page 110 STAT. 3376]]
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 various market segments. To the extent that the report
demonstrates 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 request by the Secretary of
Energy, the Secretary of Commerce may prepare and submit the report
required by this section at less than 2-year intervals.
Approved October 11, 1996.
LEGISLATIVE HISTORY--H.R. 1514:
HOUSE REPORTS: No. 104-655, Pt. 1 (Comm. on Commerce).
CONGRESSIONAL RECORD, Vol. 142 (1996):
Sept. 4, considered and passed House.
Sept. 28, considered and passed Senate.