| Happy New Year from the Energy Marketers of America!
It has been a very busy and challenging year for Energy Marketers of America and their members. We are truly grateful for your continued support and extend to you our best wishes for a happy, healthy and prosperous holiday season and New Year!
2021 Federal Motor Fuel Excise Tax Rates
EMA Contact: Mark S. Morgan, Regulatory Counsel mmorgan@emamerica.org
What’s New?
Oil Spill Liability Tax Extended - The federal Oil Spill Liability Tax (OSLT) set to expire on December 31, 2020 is extended through December 31, 2025. Refiners pay the $0.09 cents per barrel of crude oil tax and pass it down the distribution chain as a cost. OSLT is a cost and not a tax below the refinery gate.
Alternative Fuel Mixture Credit Extended - The federal Alternative Fuel Mixture Credit set to expire on December 31, 2020 is extended through December 31, 2021. The credit is 50 cents per gallon of alternative fuel used to produce a mixture containing at least 0.1 percent gasoline, diesel, or kerosene. Qualified alternative fuels are liquefied hydrogen, P-Series fuel, liquid fuel derived from coal through the Fischer-Tropsch process, and liquid fuel derived from biomass.
Expiration of COVID-19 Commercial Aviation Kerosene Tax Holiday - The 4.4 cpg federal excise tax for kerosene used in commercial aviation is reinstated on January 1, 2021.
Click here to download a detailed summary of the 2021 Federal Motor Fuel Excise Tax Rates.
President Signs COVID Relief/Government Spending Package into Law
PPP Deductibility Included, Paid Sick and Family Leave Mandate is Not
On Sunday, President Trump signed a $2.3 trillion funding package into law, which includes $1.4 trillion in government funding and $900 billion in COVID relief. The legislation extends the Small Business Administration’s (SBA) Paycheck Protection Program (PPP) and clarifies PPP expenses as tax deductible. The bill also provides $600 stimulus checks for adults and dependents, restores $300/week in additional unemployment assistance, increases SNAP benefits by 15 percent for six months (but does not expand eligibility), and allocates $20 billion in new targeted economic injury disaster loans (EIDL) for low-income communities. Please note that the bill does not include an extension of the Paid Sick and Family Leave Mandate which expires today, December 31st. However, the legislation does provide a refundable tax credit that allows businesses the option to offer paid leave, but it is no longer mandatory, and the provision expires in March 2021. Congressional leaders, however, could not reach an agreement to include Democratic priorities for additional state and local government aid and Republican’s liability protections. In signing the bill, President Trump still demanded Congress replace the $600 stimulus payments with $2,000, although it is unlikely to have enough votes to pass.
The COVID relief/government spending passage marks the end of an eventful month in Washington, DC. However, Congress still has one outstanding action on its plate before the 117th Congress begins. Congress is expected to hold a vote to override the President’s veto of the Fiscal Year 2021 National Defense Authorization Act (NDAA).
Click here for a detailed summary.
EMA Urges TSA to Extend Hazardous Materials Endorsement Waiver Set to Expire Today
EMA continued its efforts this week to obtain a waiver extension for security background checks and finger printing requirements that CDL drivers must submit to state licensing agencies for renewal of expiring hazardous material endorsements (HME). The Transportation Security Administration (TSA) first issued the waiver back in March due to COVID related closure of TSA processing centers and state licensing agencies. The TSA told EMA earlier this week that it would not extend the waiver past December 31, 2020 since all of the agency’s finger printing and security background check processing centers are open and operating at pre-COVID levels. However, the same is not true for many state licensing agencies that are still operating at reduced capacity and require drivers to wait months for in-person appointments for HME and CDL renewal. Recognizing the continuing renewal backlog on the state level, the Federal Motor Carrier Safety Administration (FMCSA) extending the validity of expired CDLs through February 28, 2021. Without a similar waiver extension by TSA, drivers waiting for a renewal appointment at their state licensing agency will be without a valid HME after December 31, 2020.
In order to avoid any disruption in the validity of expiring HMEs, EMA sent a letter this week to the Administrator of the TSA requesting a waiver extension. EMA urged the agency to reverse its decision and extend the waiver period through February 28, 2021 in order to avoid any disruption in the motor and heating fuel distribution chain due to the inability of drivers to renew their HMEs in a timely manner. NACS, SIGMA and NATSO agreed to sign onto the EMA letter. In addition, EMA enlisted the help of Senator Roger Wicker (R-MS), chairman of the Senate Committee on Commerce, Science, and Transportation, (the Committee of jurisdiction over the over the TSA) who is currently in contact with the TSA concerning an extension of the HME waiver deadline. Yesterday, TSA Administrator, David Pekoske contacted EMA to acknowledge receipt of the letter and to say it was forwarded to staff for further review. EMA will report on further developments today if an extension is granted.
Reminder: USDA Offers $22 Million in Grants to Marketers for Higher Blend Ethanol and Biodiesel Infrastructure
The U.S. Department of Agriculture (USDA) announced it is reopening the application process for the Higher Blend Infrastructure Incentive Program (HBIIP) for marketers seeking grants to install or upgrade higher blend ethanol and/or biodiesel fueling infrastructure. The application period opened on December 21, 2020 and ends on January 19, 2021. The purpose of the HBIIP program is to increase the sales of E15 or higher ethanol blends biodiesel blends greater than five percent. The USDA is making $22 million available for both retail and wholesale higher blend infrastructure. HBIIP grants cover up to 50 percent of total eligible project costs up to three million dollars for equipment upgrades at retail fueling facilities, biodiesel distribution facilities, including biodiesel terminal operations and home heating oil distribution centers or equivalent entities. Eligible Project Costs are only those costs incurred through December 31, 2020 and that are directly related to the use and purposes of the HBIIP. The HBIIP application process is lengthy.
Applicants are encouraged to start the application process as early as possible before the 30-day period ends. Applications must be filed online by clicking on “To Apply” at: HBIIP Application.
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