U.S. Legislative Updates

The Internal Revenue Service has advised fleets that their next federal highway use tax return, usually due August 31, will instead be due on November 30, 2011.  Since the highway use tax is currently scheduled to expire on September 30, 2011, this extension is designed to alleviate any confusion and possible multiple filings that could result if Congress reinstates or modifies the tax after September 30. Under  temporary and proposed regulations filed by the IRS, the November  30  filing deadline for Form 2290 (Heavy Highway Vehicle Use Tax Return) for the tax period beginning on July 1, 2011, applies to vehicles used during July, as well as those first used during August or September.  Additional information is available at http://www.irs.gov/newsroom/article/0,,id=242384,00.html


The U.S. Environmental Protection Agency (EPA) has issued a proposal under the Clean Air Act waiving requirements for systems used at fueling facilities to capture potentially harmful gasoline vapors while refueling cars.  Beginning in 2013, states meeting the new criteria have the option to do away with Stage II vapor recovery systems at the pump since an estimated seventy percent of all vehicles will be equipped by then with on-board systems that capture these vapors.

Since 1994, fueling facilities in certain areas have been required to use gasoline vapor recovery systems. The systems capture fumes that escape from gasoline tanks during refueling.  However, as required by the Clean Air Act, automobile manufacturers began installing onboard refueling vapor recovery (ORVR) technologies in 1998, making gas stations' systems redundant.  Since 2006, all new automobiles and light trucks (pickups, vans, and SUVs) are equipped with ORVR.


Legislation creating a national standard for distracted driving laws has been introduced in the U.S. House of Representatives by Congresswoman Carolyn McCarthy (D-NY).  The Safe Drivers Act of 2011 focuses on two primary efforts.  First, it directs the Secretary of Transportation to establish minimum regulations that ban the use of hand-held mobile devices on a public road while operating a moving or idling motor vehicle, except in the case of an emergency.  There are exclusions, including voice-operated, vehicle-integrated devices, as well as voice-operated GPS systems.  The bill also requires the DOT to conduct a study on distracted driving, focusing particularly on the issue of cognitive distraction and the impact of distraction on young and inexperienced drivers.  In two years, the DOT must report the findings of this study to Congress and provide recommendations for revising the minimum distracted driving prohibitions and penalties states must comply with.

The penalty for not complying with the DOT's minimum standards within two years of enactment would be a withholding of twenty-five percent of a state's federal highway transportation funding.


Senators Herb Kohl (D-WI) and Roy Blunt (R-MO) have introduced legislation providing tax credits for purchasers of hybrid, plug-in hybrid, and electric medium-duty and heavy-duty trucks.  The bill reinstates the currently-expired qualified hybrid motor vehicle tax credit.  The Kohl-Blunt bill extends the tax credit through 2015 and updates the incentive to recognize current costs and technologies.      

The credit is calculated by allowing the taxpayer to claim a credit for a percentage of an advanced vehicle's incremental cost (the excess of the retail price of the vehicle over a comparable conventional vehicle). The allowable percentage increases with the vehicle's fuel efficiency. The bill doubles the maximum amount of recognized incremental costs, creates a new section for vehicles that weigh more than 33,000 pounds, and adds a new applicable percentage category.  However, the bill also limits the maximum amount of the credit to $24,000 for the most efficient of the heavy duty vehicles.
   
Also, the bill extends the tax incentive for recharging and refueling infrastructures for plug-in and alternative fuel vehicles through 2013.   The legislation also creates a tax incentive of up to $3,500 for anti-idling infrastructure and anti-idling devices installed on trucks themselves.


NAFA has asked the U.S. Environmental Protection Agency (EPA) to reconsider the waiver to allow gasoline blends of up to fifteen percent ethanol (E15) on cars and trucks of model year 2001 and later.  "The waiver for E15 jeopardizes the billions of dollars that fleets have invested in vehicles and engines used to carry out the mission of private and public sector fleets throughout the country, NAFA's Executive Director Phil Russo, CAE, said in a July 13 letter to Lisa Jackson, the EPA Administrator.  

"We take very seriously the statements of vehicle and engine manufacturers that E15 will damage engines, void warranties, and reduce fuel efficiency," Russo said.  "We do not understand the ‘rush to judgment' based on a single set of Department of Energy tests that did not consider the effect that E15 would actually have on engines and costs."

"As a major consumer of vehicles and engines, we are concerned with the potential impact for both light-duty engines as well as non-covered engines including engine failure, corrosion, materials incompatibility, catalyst degradation, water-in-fuel and phase separation, higher exhaust temperatures, increased pollution emissions, and reduced useful life of the vehicle or engine," Russo added.  "The market place was not ready for E10 when it was introduced and it is definitely not ready for the introduction of E15."