U.S. Legislative Issues

On August 5, 2016, NAFA submitted comments to the U.S. Department of Justice (DOJ) concerning the proposed partial consent decree regarding Volkswagen’s use of defeat devices to circumvent emissions tests. As part of the deal, VW agreed to provide $2.7 billion to establish a mitigation trust fund (MTF) that would be used by government and tribal agencies to fund actions that reduce diesel emissions. In its comments, NAFA proposed that a number of changes in the administration of the MTF be made to better achieve the decree’s goal of offsetting the adverse effects caused by VW’s use of defeat technology. These suggested changes include:

• Broadening the allowable mitigation actions and uses of settlement funds to consider the allocation, right typing, utilization management, operator management, maintenance and repair, fueling, and replacement of vehicles rather than limiting the focus to the replacement or repowering of conventionally fueled vehicles with alternative fuel vehicles.
• Permitting beneficiaries to earmark 10 to 20 percent of the proposed settlement for grants for research, education, and other information dissemination and professional development activities that could advance an organization’s ability to manage vehicle energy consumption and associated environmental impacts.
• Awarding funds to entities that demonstrate a cost-effective reduction in emissions of nitrous oxides (NOx), regardless of the technology used.
• Increasing the subsidy for private fleets.

The public comment period for the proposed settlement closed on August 6. The decree is now subject to final approval by U.S.  Northern District of California Judge, Charles Breyer, who could issue his decision as soon as October.


In a report issued on July 20, 2016, the U.S. Environmental Protection Agency (EPA) outlined new findings of moderate or severe corrosion inside both steel and fiberglass fuel underground storage tanks (USTs). Corrosion inside USTs can cause equipment failure by preventing proper operation of release detection and prevention equipment. If left unchecked, corrosion can cause UST system failures and releases, which could lead to groundwater contamination.

EPA’s report shows that 35 of 42 – or 83 percent – of the USTs studied exhibited moderate or severe corrosion, but less than 25 percent of owners were aware of corrosion prior to the internal inspection. Although EPA cannot project the actual percentage of USTs storing diesel that are affected by corrosion nationwide, the Agency is alerting owners of USTs storing diesel fuel about risks from corrosion. EPA’s notification recommends owners check inside their tank systems and further investigate the condition of their diesel fuel tanks. EPA states that owners’ awareness and early actions could help protect them from higher repair costs and help protect the environment from contamination from releases. EPA’s UST website (https://www.epa.gov/ust) provides information on actions tank owners can take to minimize corrosion and associated risks.

EPA cannot say for certain what causes corrosion in diesel tanks, but microbiologically-influenced corrosion is suspected to be involved. In that vein, EPA says it will continue to work collaboratively with partners in the UST community, industry, and scientific experts on additional laboratory research to determine the cause of corrosion.


On August 3, 2016, the Federal Motor Carrier Safety Administration (FMCSA) issued a safety advisory to owners and operators of commercial motor vehicles (CMVs) concerning incidents involving battery-powered portable electronic smoking devices such as e-cigarettes, e-cigars, e-pipes, e-hookahs, personal vaporizers (vapes), and electronic nicotine delivery systems.

The advisory cites a 2014 report by the U.S. Fire Administration that found 25 reported incidents involving the devices that resulted in explosions, serious personal injuries or fires between 2009 and 2014. The advisory warns that this number could be low and that news sources have reported more than 150 explosions involving drivers and electronic smoking devices. The explosions regularly involved the ejection of a burning battery case or other components from the device which subsequently ignited nearby flammable or combustible materials.

In light of these incidents, FMCSA is asking motor carriers and drivers to be cognizant of the risks associated with these devices and to "exercise good judgment and appropriate discretion in their possession, storage, and charging or use on, around, or while operating a CMV, and adhere to the smoking prohibitions on, near, or when loading and unloading a motor vehicle transporting hazardous materials."


On July 13, 2016, Sen. Charles Grassley (R-IA) introduced S. 3188, the Biodiesel Tax Incentive Reform and Extension Act of 2016, legislation that would extend the $1-per-gallon tax credit for biodiesel and reform the credit so it is only used for fuel produced in the U.S.

On August 10, 2016, NAFA sent a letter to Senate Finance Committee Chairman Orrin Hatch (R-UT) and Ranking Member Ron Wyden (D-OR) in opposition of S. 3188. In the letter, NAFA writes, "Although we (NAFA) support an extension of the biodiesel tax credit, we oppose any change to the structure of the tax credit for biodiesel. Converting the tax credit to a producer's tax credit and denying its availability to all fuels will have a negative impact on the cost and availability of renewable diesel."