I. Senate Bill 52 (Senator John Sullivan) and House Bill 165 (Representative John Bradley) amends the Illinois Renewable Fuels Development Act, the change would mandate $20 million in grants to be split between different Ethanol Projects. Currently, the Director of Commerce and Economic Opportunity awards these grants to companies that are constructing, modifying and retrofitting a plant in Illinois.
II. The Bill also transfers the Illinois Sales Tax Incentive from E-10 to E-15 by redefining gasohol. In Illinois “Gasohol,” is defined as 90% gasoline and 10% denatured ethanol. This bill would change that definition to the maximum proportion of ethanol authorized by the US EPA (which is currently 15% ethanol blend). Consumers pay a 20% less sales tax on “Gasohol,” and if Senate Bill 52 or House Bill 165 passes the “Gasohol,” sales tax incentive will be moved to a 15% Ethanol blend, the incentive to the consumers will be reduced by half, and the sales tax incentive on E-10 will be eliminated. This will result in consumers in the Chicago Metro Area paying an additional 8 – 10 cents more per gallon for gasoline, because for 3 to 4 more years Chicago vapor recovery systems cannot use E-15. Downstate consumers will pay more for gasoline during the summer months, because E-15 can only be sold in Illinois from September 16 to May 20 – 8 months a year. During the summer months, consumers will pay an additional 3 to 5 cents more a gallon for E-10 gasoline.
Gasoline retailer infrastructure (tanks, piping, pumps) certified and installed prior to 2007 failed E-15 compatibility test, 70% of the time. This could create leaks impacting the environment and ground water.
Manufacturer engine warranties will not protect consumers. Engine warranties will NOT be honored if E-15 is used in motorcycles, marine engines, lawn mowers, and 2 and 4 cycle engines. Automobile engine manufacturers have only warrantied a few non flex fuel engines.
If this bill passes, it will be a significant sales tax increase on Illinois consumers. While a few members of the agricultural community will benefit, Illinois fuel retailers and consumers will realize none of the benefits while bearing all the cost and liability.
The Illinois Petroleum Marketers Association (IPMA) and Illinois Association of Convenience Stores (IACS) represent small businessmen and women that distribute and retail gasoline, diesel fuel, and other petroleum products throughout Illinois. The IPMA/IACS has been a National leader in the blending and selling of ethanol blended gasoline, and opposes Senate Bill 52 and House Bill 165.
Thank you and should you like to discuss this legislation in further detail, please contact Bill Fleischli at 217/5444-4609 ext. 8 or by e-mail at email@example.com.