HB 575 — Fuel Tax and Supply Amendments

575 Enrolled Copy authority of the Board of Oil, Gas, and Mining or the Division of Oil, Gas, and Mining to regulate oil and gas operations, including the fostering and promotion of natural resource development under Title 40, Mines and Mining.

Section 319-14-202 is enacted to read:

19-14-202.19-14-202 .

(2)(2)(a) (a) The division director may, based on extraordinary circumstances, and without the concurrence of the applicant, extend the deadline described in Subsection (1) for a reasonable period not to exceed 30 days.

- 4 - HB0575 compared with HB0575S01 (3) The division director may, with concurrence of the applicant, extend the deadline described in Subsection (1) for a term agreed upon by the division director and the applicant.

59-13-102.59-13-102 .

(5)- (a)4 "Diesel- fuel"Enrolled meansCopy anyH.B. liquid that is commonly or commercially known, offered for sale, or used as a fuel in diesel engines.

575 (5)(a) "Diesel fuel" means any liquid that is commonly or commercially known, offered for sale, or used as a fuel in diesel engines.

- 5 - HB0575 compared with HB0575S01 (c) is engaged in the business of purchasing motor fuel for resale in wholesale quantities to retail dealers of motor fuel and who accounts for his own motor fuel tax liability;

(13)- "Highway"5 means- everyH.B. way or place, of whatever nature, generally open to the use of the public for the purpose of vehicular travel notwithstanding that the way or place may be temporarily closed for the purpose of construction, maintenance, or repair.

575 Enrolled Copy (13) "Highway" means every way or place, of whatever nature, generally open to the use of the public for the purpose of vehicular travel notwithstanding that the way or place may be temporarily closed for the purpose of construction, maintenance, or repair.

(a) motor fuels that have been loaded at the refinery or other place into tank cars, placed in any tank at the refinery from which any withdrawals are made directly into tank trucks, tank wagons, or other types of transportation equipment, containers, or facilities other than tank cars, or placed in any - 6 - HB0575 compared with HB0575S01 tank at the refinery from which any sales, uses, or deliveries not involving transportation are made directly;

(17)(17)(a) (a) "Qualified motor vehicle" means a special fuel-powered motor vehicle used, designed, or maintained for transportation of persons or property which:

(19)- (a)6 ["Removal,"- asEnrolled usedCopy inH.B. Part 3, Special Fuel, ] "Removal" means the physical transfer of motor fuel or diesel fuel from a production, manufacturing, terminal, or refinery facility and includes use of motor fuel or diesel fuel.

575 (19)(a) ["Removal," as used in Part 3, Special Fuel, ] "Removal" means the physical transfer of motor fuel or diesel fuel from a production, manufacturing, terminal, or refinery facility and includes use of motor fuel or diesel fuel.

(20)(20)(a) - 7 - HB0575 compared with HB0575S01 (a) "Special fuel" means any fuel regardless of name or character that:

4082 or United States Environmental Protection- Agency7 or- InternalH.B. Revenue Service regulations.

575 Enrolled Copy Protection Agency or Internal Revenue Service regulations.

- 8 - HB0575 compared with HB0575S01 [(27)] (28) "Ute tribal member" means an enrolled member of the Ute tribe.

59-13-201.59-13-201 .

(1)(1)(a)(i) (a) (i) Subject to Subsection (1)(a)(ii) and the provisions of this section and except as provided in Subsection (1)(e), a tax is imposed at the rate of 14.2% of the statewide average rack price of a gallon of motor fuel per gallon upon all motor fuel that is sold, used, or received for sale or used in this state.

[(ii) Notwithstanding Subsection (1)(a)(i), for the period beginning on July 1, 2023, and ending on December 31, 2023, the rate described in Subsection (1)(a)(i) shall be 34.5 cents per gallon.] (b)(b)[(i) [(i) Until December 31, 2018, and subject to the requirements under Subsection (1)(c), the statewide average rack price of a gallon of motor fuel under Subsection (1)(a) shall be determined by calculating the previous fiscal year statewide average rack price of a gallon of regular unleaded motor fuel, excluding federal and state excise taxes, for the 12 months ending on the previous June as published by an oil pricing service.] - 98 - HB0575Enrolled comparedCopy withH.B. HB0575S01 [(ii) Beginning on January 1, 2019, and subject] Subject to the requirements under Subsection (1) (c), the statewide average rack price of a gallon of motor fuel under Subsection (1)(a) shall be determined by calculating the previous three fiscal years statewide average rack price of a gallon of regular unleaded motor fuel, excluding federal and state excise taxes, for the 36 months ending on the previous June 30 as published by an oil pricing service.

(c)575 (i)(1)(a) shall be determined by calculating the previous fiscal year statewide average rack price of a gallon of regular unleaded motor fuel, excluding federal and state excise taxes, for the 12 months ending on the previous June 30 as published by an oil pricing service.] [(ii) Beginning on January 1, 2019, and subject] Subject to the requirementrequirements inunder Subsection (1)(c)(ii),(1)(c), the three-yearstatewide rolling average rack price of a gallon of motor fuel under Subsection (1)(a) shall be determined by calculating the previous three fiscal years statewide average rack price of a gallon of regular unleaded motor fuelfuel, determinedexcluding underfederal Subsectionand (1)(b)state mayexcise nottaxes, befor lessthe than36 $1.78months perending gallon.on the previous June 30 as published by an oil pricing service.

(c)(i) Subject to the requirement in Subsection (1)(c)(ii), the three-year rolling average of the statewide average rack price of a gallon of motor fuel determined under Subsection (1)(b) may not be less than $1.78 per gallon.

(d)(d)(i) (i) The commission shall annually:

(A) determine the three-year rolling average of the statewide average rack price of a- gallon9 of- motorH.B. fuel in accordance with Subsections (1)(b) and (c);

-575 10Enrolled -Copy HB0575a comparedgallon withof HB0575S01motor (B) adjust the fuel taxin rateaccordance imposedwith underSubsections Subsection(1)(b) (1)(a),and rounded(c); to the nearest one-tenth of a cent, based on the determination under Subsection (1)(b);

(B) adjust the fuel tax rate imposed under Subsection (1)(a), rounded to the nearest one-tenth of a cent, based on the determination under Subsection (1)(b);

and (D) post or otherwise make public the adjusted fuel tax rate as determined in Subsection (1)(d)(i)(1)(d)(i)(B) (B) no later than 60 days before the annual effective date under Subsection (1)(d)(ii).

(3)(3)(a) (a) No motor fuel tax is imposed upon:

(5)(5)(a) (a) All revenue received by the commission under this part shall be deposited daily with the state treasurer and credited to the Transportation Fund.

- 11 - HB0575 compared with HB0575S01 (b) An appropriation from the Transportation Fund shall be made to the commission to cover- expenses10 incurred- inEnrolled theCopy administrationH.B. and enforcement of this part and the collection of the motor fuel tax.

(6)575 (a)cover Theexpenses commissionincurred shallin determine what amount of motor fuel tax revenue is received from the saleadministration orand useenforcement of motorthis fuelpart used in motorboats registered under Title 73, Chapter 18, State Boating Act, and this amount shall be deposited into a restricted revenue account in the Generalcollection Fund of the state.motor fuel tax.

(6)(a) The commission shall determine what amount of motor fuel tax revenue is received from the sale or use of motor fuel used in motorboats registered under Title 73, Chapter 18, State Boating Act, and this amount shall be deposited into a restricted revenue account in the General Fund of the state.

(7)(7)(a) (a) The United States government or any of its instrumentalities, this state, or a political subdivision of this state that has purchased motor fuel from a licensed distributor or from a retail dealer of motor fuel and has paid the tax on the motor fuel as provided in this section is entitled to a refund of the tax and may file with the commission for a quarterly refund.

(8)(8)(a) (a) The commission shall refund annually into the Off-highway Vehicle Account in the General Fund an amount equal to .5% of the motor fuel tax revenues collected under this section.

(9)(9)(a) (a) [Beginning on April 1, 2001, a] A tax imposed under this section on motor fuel that is sold, used, or received for sale or use in this state is reduced to the extent provided in Subsection (9)(b) if:

(b)(b)(i) - 12 - HB0575 compared with HB0575S01 (i) If but for Subsection (9)(a) the motor fuel is subject to a tax imposed by this section:

(A)- the11 state- shallH.B. be paid the difference described in Subsection (9)(b)(ii) if that difference is greater than $0;

575 Enrolled Copy (A) the state shall be paid the difference described in Subsection (9)(b)(ii) if that difference is greater than $0;

- 1312 - HB0575Enrolled comparedCopy withH.B. HB0575S01 (A) notwithstanding Section 59-1-403, authorize the commission to disclose to the Navajo Nation information that is[:] [(I)] contained in a document filed with the commission[;] , and [(II)] related to the tax imposed under this section;

575 (A) notwithstanding Section 59-1-403, authorize the commission to disclose to the Navajo Nation information that is[:] [(I)] contained in a document filed with the commission[;] , and [(II)] related to the tax imposed under this section;

(f)(f)(i) (i) If[, on or after April 1, 2001,] the Navajo Nation changes the tax rate of a tax imposed on motor fuel, any change in the reduction of taxes under this Subsection (9) as a result of the change in the tax rate is not effective until the first day of the calendar quarter after a 60-day period beginning on the date the commission receives notice:

59-13-301.59-13-301 .

(1)(1)(a) (a) Except as provided in Subsections (1)(b), (2), (3), (11), and (12) and Section [59-13-304][ 59-13-304] 59-13-301.5, a tax is imposed at the same rate imposed under Subsection 59-13-201(1)59-13-201(1)(a) (a) on the:

- 14 - HB0575 compared with HB0575S01 (ii) removal of undyed diesel fuel from any terminal;

(iii) entry into the state of any undyed diesel fuel for consumption, use, sale, or warehousing;- 13 - H.B.

575 Enrolled Copy warehousing;

(2)(2)(a) (a) No special fuel tax is imposed or collected upon dyed diesel fuel which:

(a)(a)(i) - 15 - HB0575 compared with HB0575S01 (i) purchased for business use in machinery and equipment not registered and not required to be registered for highway use;

and (ii) used [pursuant to] in accordance with the conditions of a state implementation plan- approved14 under- TitleEnrolled 19,Copy ChapterH.B. 2, Air Conservation Act;

575 plan approved under Title 19, Chapter 2, Air Conservation Act;

(6)(6)(a) (a) The special fuel tax shall be paid by every user who is required by Sections 59-13-303 and 59-13-305 to obtain a special fuel user permit and file special fuel tax reports.

(7)(7)(a) (a) Except as provided under Subsections (7)(b) and (c), all revenue received by the commission from taxes and license fees under this part shall be deposited daily with the state treasurer and credited to the Transportation Fund.

(9)(9)(a) (a) The United States government or any of its instrumentalities, this state, or a political subdivision of this state that has purchased special fuel from a supplier or from a retail dealer of special fuel and has paid the tax on the special fuel as provided in this section is entitled to a refund of the tax and may file with the commission for a quarterly refund in a manner prescribed by the commission.

-(10)(a) 16 - HB0575 compared with HB0575S01 (10) (a) The purchaser shall pay the tax on diesel fuel or clean fuel purchased for uses under Subsections (2)(2)(b)(i), (b)(i), (iii), (iv), (v), (vi), and (vii) and apply for a refund for the tax paid as provided in Subsection (9) and this Subsection (10).

(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the commission shall make rules governing the application and refund for off-highway and- nonhighway15 uses- providedH.B. under Subsections (2)(b)(iii), (iv), (vi), and (vii).

575 Enrolled Copy and nonhighway uses provided under Subsections (2)(b)(iii), (iv), (vi), and (vii).

(11)(11)(a) (a) [Beginning on April 1, 2001, a] A tax imposed under this section on special fuel is reduced to the extent provided in Subsection (11)(b) if:

(b)(b)(i) (i) If but for Subsection (11)(a) the special fuel is subject to a tax imposed by this section:

- 17 - HB0575 compared with HB0575S01 (e) The agreement required under Subsection (11)(a):

or (C)- affect16 the- powerEnrolled ofCopy theH.B. state to establish rates of taxation;

575 (C) affect the power of the state to establish rates of taxation;

(f)(f)(i) (i) If[, on or after April 1, 2001,] the Navajo Nation changes the tax rate of a tax imposed on special fuel, any change in the amount of the reduction of taxes under this Subsection (11) as a result of the change in the tax rate is not effective until the first day of the calendar quarter after a 60-day period beginning on the date the commission receives notice:

- 18 - HB0575 compared with HB0575S01 (A) that the Navajo Nation has changed or will change the tax rate of a tax imposed on special fuel;

(g) If the agreement required by Subsection (11)(a) terminates, a reduction of tax is not permitted- under17 this- SubsectionH.B. (11) beginning on the first day of the calendar quarter after a 30-day period beginning on the day the agreement terminates.

575 Enrolled Copy permitted under this Subsection (11) beginning on the first day of the calendar quarter after a 30-day period beginning on the day the agreement terminates.

(12)(12)(a)(i) (a) (i) [Subject] Beginning on January 1, 2026, and subject to Subsections (12)(a)(ii) and (iii), a tax imposed under this section on compressed natural gas is imposed at a rate of[:] $0.212 per gallon equivalent.

(b)(b)(i) - 19 - HB0575 compared with HB0575S01 (i) [Subject ] Beginning on January 1, 2026, and subject to Subsections (12)(b)(ii) and (iii), a tax imposed under this section on liquified natural gas is imposed at a rate of[:] $0.212 per gallon equivalent.

and] [(D) beginning on or after July 1, 2018, 16-1/2 cents per diesel gallon equivalent.] (ii)- Beginning18 on- JanuaryEnrolled 1,Copy [2020]H.B. 2027, the commission shall, on January 1, annually adjust the rate of a tax imposed under this section on liquified natural gas by taking the rate for the previous calendar year and adding an amount equal to the greater of:

575 (ii) Beginning on January 1, [2020] 2027, the commission shall, on January 1, annually adjust the rate of a tax imposed under this section on liquified natural gas by taking the rate for the previous calendar year and adding an amount equal to the greater of:

(c)(c)(i) (i) [Subject] Beginning on January 1, 2026, and subject to Subsections (12)(c)(ii) and (iii), a tax imposed under this section on hydrogen used to operate or propel a motor vehicle upon the public highways of the state is imposed at a rate of[:] $0.212 per gallon equivalent.

- 20 - HB0575 compared with HB0575S01 (A) an amount calculated by multiplying the rate of a tax imposed under this section on hydrogen used to operate or propel a motor vehicle upon the public highways of the state for the previous calendar year by the actual percent change during the previous fiscal year in the Consumer Price Index;

(iii) The rate of a tax imposed under this section on hydrogen used to operate or propel a motor vehicle upon the public highways of the state determined by the commission- under19 Subsection- (12)(c)(ii)H.B. may not exceed 22-1/2 cents per gasoline gallon equivalent.

(d)575 (i)Enrolled TheCopy commission shallunder annually:Subsection (12)(c)(ii) may not exceed 22-1/2 cents per gasoline gallon equivalent.

(d)(i) The commission shall annually:

and (C) post or otherwise make public the adjusted fuel tax rate as determined in Subsection (12)(d)(i)(12)(d)(i)(A) (A) no later than 60 days [prior to] before the annual effective date under Subsection (12)(d)(ii).

(ii) The tax rates imposed under this Subsection (12) and adjusted as required under Subsection (12)(d)(12)(d)(i) (i) shall take effect on January 1 of each year.

63I-2-259.63I-2-259 .

Section 872-5-501 is enacted to read:

-Part 215. - HB0575 compared with HB0575S01 72-5-501.

Pipeline Right-of-Way Cooperation 72-5-501 .

(1)- "Common20 carrier- pipeline"Enrolled isCopy aH.B. pipeline engaged in the transportation of petroleum products, including refined products, that holds itself out to provide transportation service to the public for compensation on reasonable terms.

575 (1) "Common carrier pipeline" is a pipeline engaged in the transportation of petroleum products, including refined products, that holds itself out to provide transportation service to the public for compensation on reasonable terms.

Section 972-5-502 is enacted to read:

72-5-502.72-5-502 .

Section 1079-6-410 is enacted to read:

79-6-410.79-6-410 .

(a) "Barrel" means an amount equal to 42 gallons of oil at atmospheric pressure and at a temperature of 60 degrees Fahrenheit.

- 22 - HB0575 compared with HB0575S01 (g) "Refinery" means a facility located in this state at which petroleum refining is conducted, including processing units, storage facilities, and associated infrastructure under common ownership or operational control at a single geographic location or integrated complex.

(2) Beginning July 1, 2026, and quarterly thereafter, a refiner shall provide to the office a report- that21 includes:- H.B.

575 Enrolled Copy report that includes:

(3)(3)(a) (3){(a)} The office shall compile the data received in the report described in Subsection (2) for each refiner.

(4)(4)(a) (a) Information provided to the office under this section is:

(5)(5)(a) (a) The office or any state agency may not release, publish, or disclose information reported under this section in a manner that identifies, or could reasonably be used to identify:

- 23 - HB0575 compared with HB0575S01 (ii) a refiner;

(6)(6)(a) (a) Information collected under this section may be used only for:

or (ii)- energy22 planning- purposes.Enrolled Copy H.B.

575 (ii) energy planning purposes.

(7)(7)(a) (a) Information reported under this section may not be shared with another state agency or political subdivision unless:

(9)(9)(a) (a) Information reported under this section is not subject to subpoena, discovery, or admission into evidence in any civil, criminal, or administrative proceeding.

- 24 - HB0575 compared with HB0575S01 (b) A court may not order disclosure of information reported under this section.

(10)(10)(a) (a) The office shall adopt rules establishing a secure procedure for submission, storage, and handling of information reported under this section.

(11)(11)(a) (a) The office may retain reported information only for the minimum period necessary to perform the purposes described in Subsection (6).

(12)(12)(a) (a) A person who knowingly discloses information protected under this section is guilty of a class A misdemeanor.

(b) A reporting entity may bring a civil action for damages, injunctive relief, and attorney fees against a person or government entity that unlawfully discloses protected- information.23 - H.B.

575 Enrolled Copy protected information.

79-6-602.79-6-602 .

(2)(2)(a) (a) "District energy system" means equipment and facilities that:

and - 25 - HB0575 compared with HB0575S01 (ii) deliver services through a distribution system.

(3)(3)(a) (a) "Energy delivery project" means a project that is designed to:

(i)- a24 hydroelectric- energyEnrolled storageCopy system;H.B.

575 (i) a hydroelectric energy storage system;

- 26 - HB0575 compared with HB0575S01 (5) "Fuel standard compliance project" means a project designed to retrofit a fuel refinery in order to make the refinery capable of producing fuel that complies with the United States Environmental Protection Agency's Tier 3 gasoline sulfur standard described in 40 C.F.R.

(i)(i)(A) (A) that expands or creates new industrial, mining, manufacturing, or agriculture activity in the state, not including a retail business;

and (iii) for which the cost of infrastructure construction to the entity creating the project is- greater25 than:- H.B.

575 Enrolled Copy is greater than:

- 27 - HB0575 compared with HB0575S01 (7) "Infrastructure" means:

(8)(8)(a) (a) "Infrastructure cost-burdened entity" means an applicant that enters into an agreement with the office that qualifies the applicant to receive a tax credit as provided- in26 this- part.Enrolled Copy H.B.

575 provided in this part.

and - 28 - HB0575 compared with HB0575S01 (f) Title 59, Chapter 12, Sales and Use Tax Act.

(14)(14)(a) (a) "Underground mine infrastructure project" means a project that:

(b)- "Underground27 mine- infrastructureH.B. project" includes:

575 Enrolled Copy (b) "Underground mine infrastructure project" includes:

- 29 - HB0575 compared with HB0575S01 (b) associated with existing mineral operations;

Section .12.

ITEMTEM 1 To Transportation - Pass-Through From General Fund, One-time 11,903,900 Schedule of Programs:

Effective date.

2-17-26 9:41 PM - 3028 -