By: Goldman (Senate Sponsor - Alvarado) H.B. No. 3408
(In the Senate - Received from the House May 3, 2021;
May 12, 2021, read first time and referred to Committee on Business &
Commerce; May 21, 2021, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 9, Nays 0;
May 21, 2021, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR H.B. No. 3408 By: Hancock
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of motor fuel metering devices and motor
fuel quality.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2310.001(a), Occupations Code, is
amended by amending Subdivisions (1), (3), (6), (7), and (8) and
adding Subdivisions (1-a), (4-a), (5-a), (9-a), and (9-b) to read
as follows:
(1) "Automotive fuel rating" has the meaning assigned
by 15 U.S.C. Section 2821.
(1-a) "Commercial [weighing or] measuring device"
means a [weighing or] measuring device used in a commercial
transaction.
(3) "Dealer" means a person who[:
[(A)] is the operator of a [service station or
other] retail motor fuel facility [outlet; and
[(B) delivers motor fuel into the fuel tanks of
motor vehicles or motor boats].
(4-a) "Distributor" means a person who makes retail or
wholesale sales of motor fuel.
(5-a) "Measuring device" means a mechanical or
electronic device used to:
(A) dispense or deliver a motor fuel by volume,
flow rate, or other measure; or
(B) compute the charge for a service related to
motor fuel.
(6) "Motor fuel" means gasoline, diesel fuel, gasoline
blended fuel, aviation gasoline, aviation jet fuel, compressed
natural gas, liquefied natural gas, and other products that are
capable of use as fuel for a gasoline-powered engine or a
diesel-powered engine [has the meaning assigned by Section 162.001,
Tax Code].
(7) "Motor fuel metering device" means a commercial
[weighing or] measuring device used for motor fuel sales.
(8) "Operator" or "user" means a person in possession
or control of a [weighing or] measuring device, including an owner,
custodian, or seller.
(9-a) "Supplier" has the meaning assigned by Section
162.001, Tax Code.
(9-b) "Wholesaler" means a person who purchases
tax-paid motor fuel for resale or distribution at wholesale.
SECTION 2. Section 2310.002(c), Occupations Code, is
amended to read as follows:
(c) The department may contract with one or more license
holders under Subchapter D [of this chapter or Subchapter I,
Chapter 13, Agriculture Code,] to perform the department's duties
under this chapter related to motor fuel metering devices. A
reference in this chapter to the commission or department in the
context of a contracted service means the contractor.
SECTION 3. Chapter 2310, Occupations Code, is amended by
adding Subchapter A-1 to read as follows:
SUBCHAPTER A-1. ADVISORY BOARD
Sec. 2310.031. DEFINITION. In this subchapter, "board"
means the Motor Fuel Metering and Quality Advisory Board.
Sec. 2310.032. BOARD MEMBERSHIP. (a) The board consists of
nine members appointed by the presiding officer of the commission,
with the approval of the commission, as follows:
(1) four members who are dealers or representatives
designated by the dealers, including:
(A) one dealer that has fewer than 501 motor fuel
metering devices registered with the department;
(B) one dealer that has more than 1,000 but fewer
than 5,000 motor fuel metering devices registered with the
department;
(C) one dealer that has more than 5,000 motor
fuel metering devices registered with the department; and
(D) one dealer without regard to the dealer's
number of motor fuel metering devices registered with the
department;
(2) two members who represent service companies, as
defined by Section 2310.151;
(3) one member who represents a wholesaler or
distributor;
(4) one member who represents a supplier; and
(5) one member of the public.
(b) The presiding officer of the commission, with the
approval of the commission, shall appoint two ex officio nonvoting
members of the board. An ex officio member is not counted as a
member for purposes of establishing a quorum. The ex officio
members must include:
(1) one member who represents:
(A) a financial institution, as defined by
Section 277.001, Finance Code; or
(B) a credit card issuer other than a financial
institution; and
(2) one member who represents a law enforcement
agency.
(c) Appointments to the board shall be made without regard
to the race, color, disability, sex, religion, age, or national
origin of the appointees.
Sec. 2310.033. TERMS; VACANCY. (a) Members of the board
serve staggered six-year terms, with the terms of three or four
members expiring on February 1 of each odd-numbered year.
(b) If a vacancy occurs during a member's term, the
presiding officer of the commission, with the commission's
approval, shall appoint a replacement to fill the unexpired term.
Sec. 2310.034. PRESIDING OFFICER. The presiding officer of
the commission, with the approval of the commission, shall appoint
one of the board members to serve as presiding officer of the board
for a term of one year.
Sec. 2310.035. DUTIES. The board may advise the commission
and department on:
(1) the adoption of appropriate standards for the
installation, maintenance, calibration, alteration, operation,
testing, or inspection, as applicable, of:
(A) motor fuel dispensing devices;
(B) motor fuel metering devices; and
(C) motor fuel;
(2) education and curricula for applicants for a
license issued under this chapter and license holders;
(3) the content of examinations;
(4) proposed rules and standards on technical issues
related to motor fuel metering and quality and payment card
skimmers; and
(5) other issues affecting motor fuel metering and
quality.
Sec. 2310.036. MEETINGS. The advisory board shall meet at
the call of the executive director or the presiding officer of the
commission.
SECTION 4. The heading to Subchapter B, Chapter 2310,
Occupations Code, is amended to read as follows:
SUBCHAPTER B. STANDARD [WEIGHTS AND] MEASURES FOR MOTOR FUEL
SECTION 5. Sections 2310.051(a), (c), and (d), Occupations
Code, are amended to read as follows:
(a) The legal standard for the [weight or] measure of a
motor fuel in this state is the standard [weight or] measure adopted
and used by the government of the United States for that motor fuel.
If the United States does not provide a standard [weight or] measure
for a motor fuel, the standard for the motor fuel is that
established by this subchapter.
(c) Except as otherwise provided by an express contract, a
contract for work or sales by [weight or] measure of a motor fuel
shall be construed in accordance with the standards of this
subchapter.
(d) The standards of this subchapter shall be the guide for
making any adjustment of [weighing or] measuring devices under the
law of this state.
SECTION 6. Section 2310.053, Occupations Code, is amended
by adding Subsection (c) to read as follows:
(c) Notwithstanding Section 2310.002, this chapter does not
apply to a weighing or measuring device, as defined by Section
13.001, Agriculture Code, that measures liquefied petroleum gas.
SECTION 7. Section 2310.054, Occupations Code, is amended
to read as follows:
Sec. 2310.054. SALE OF MOTOR FUEL BY PROPER MEASURE. (a)
Except as otherwise provided by this section, motor fuel shall be
sold by liquid measure.
(b) Compressed natural gas and liquefied natural gas shall
be sold by gallon equivalent [weight].
(c) A person violates this chapter if[, in violation of this
section,] the person sells motor fuel in a manner [by] other than
the manner required by this section [weight or liquid measure].
SECTION 8. Section 2310.056, Occupations Code, is amended
to read as follows:
Sec. 2310.056. FALSE REPRESENTATION OF MOTOR FUEL QUANTITY.
A person violates this chapter if the person or the person's
representative or agent:
(1) sells or offers or exposes for sale a quantity of
motor fuel that is less than the quantity the person represents; or
(2) as a buyer furnishing the [weight or] measure of a
motor fuel by which the amount of the motor fuel is determined,
takes or attempts to take more than the quantity the person
represents.
SECTION 9. Section 2310.057, Occupations Code, is amended
to read as follows:
Sec. 2310.057. USE OF INCORRECT MOTOR FUEL METERING DEVICE.
(a) A person commits an offense if the person or the person's
representative or agent knowingly uses an incorrect [weighing or]
measuring device in:
(1) buying or selling motor fuel;
(2) computing a charge for services rendered on the
basis of [weight or] measure; or
(3) determining the [weight or] measure of motor fuel,
if a charge is made for the determination.
(b) For the purpose of this section, a [weighing or]
measuring device is incorrect if it:
(1) does not conform as closely as practicable to the
official standards;
(2) is not accurate;
(3) is of a construction that is not reasonably
permanent in adjustment or does not correctly repeat its
indications;
(4) facilitates the perpetration of fraud; or
(5) does not conform to the specifications and
tolerances under Section 2310.107.
SECTION 10. Sections 2310.059(a) and (c), Occupations Code,
are amended to read as follows:
(a) The department shall from time to time [weigh or]
measure an amount of motor fuel that is kept or offered for sale,
sold, or in the process of delivery, in order to determine:
(1) if the motor fuel is of the amount or quantity
represented; or
(2) if the motor fuel is being offered for sale or sold
in accordance with law.
(c) A person commits an offense if the person or the
person's employee or agent refuses to exhibit motor fuel being sold
or offered for sale at a given [weight or] quantity, or ordinarily
sold in that manner, to the department for testing and proving as to
quantity.
SECTION 11. Sections 2310.060(a) and (b), Occupations Code,
are amended to read as follows:
(a) If the department has reason to believe that motor fuel
is being sold or kept, offered, or exposed for sale in violation of
this chapter or that motor fuel is being sold or offered for sale by
or through the use of a motor fuel metering device that is in
violation of this chapter, the executive director may issue an
order to stop the sale of the motor fuel. The executive director
shall issue the order to the dealer or operator of the retail motor
fuel facility selling [owner or custodian of] the motor fuel or
offering the motor fuel for sale [or seller of the motor fuel]. The
person receiving the order may not sell the motor fuel until
discharged by a court under Subsection (b) or until the executive
director finds that the motor fuel or motor fuel metering device is
in compliance with this chapter.
(b) A dealer or operator [The owner, custodian, or seller of
motor fuel] prohibited from selling motor fuel [sale] by an order of
the executive director is entitled to sue in a court where the motor
fuel is found or is being sold or offered for sale for a judgment as
to the justification of the order and for the discharge of the motor
fuel in accordance with the findings of the court.
SECTION 12. Section 2310.061(b), Occupations Code, is
amended to read as follows:
(b) It is a defense to prosecution or to the imposition of a
civil or administrative penalty for a violation of Section 2310.057
or 2310.059 that a discrepancy between the actual [weight or]
volume at the time of sale to a consumer or a discrepancy between
the fill of a container and the capacity of the container is due to
unavoidable leakage, shrinkage, evaporation, waste, or causes
beyond the control of the seller acting in good faith.
SECTION 13. Section 2310.101(a), Occupations Code, is
amended to read as follows:
(a) If the department has reason to believe that a motor
fuel metering device is being used for a commercial transaction and
the device is not registered with the department or is being used to
facilitate the perpetration of fraud, the department may inspect
the device and the records [of the owner, operator, or user of the
device] that relate to use of the device to determine whether the
device is in compliance with this chapter.
SECTION 14. Sections 2310.106(b), (c), (f), and (g),
Occupations Code, are amended to read as follows:
(b) The commission may adopt rules to regulate the frequency
and place of inspection and correction of the standards for motor
fuel used by an individual or business licensed by the department to
perform device maintenance activities under Subchapter D [or an
individual or business licensed under Subchapter I, Chapter 13,
Agriculture Code].
(c) The department may inspect any standard for motor fuel
used by an individual or business licensed by the department to
perform device maintenance activities described by Subchapter D [or
an individual or business licensed under Subchapter I, Chapter 13,
Agriculture Code], if the department has reason to believe a
standard is no longer in compliance with this chapter.
(f) The state metrology laboratory, or a metrology
laboratory certified by the National Institute of Standards and
Technology and approved by the department, shall inspect and
correct the standards for motor fuel used by the [a] department or
[inspector, another department employee,] an individual or
business licensed by the department to perform device maintenance
activities under Subchapter D[, or an individual or business
licensed under Subchapter I, Chapter 13, Agriculture Code].
(g) The department and the state metrology laboratory may
[shall] enter into a memorandum of understanding to implement this
section. The memorandum of understanding must provide department
personnel and persons licensed under Subchapter D with access to
state metrology laboratory services equal to the access provided to
Department of Agriculture personnel and persons licensed under
Subchapter I, Chapter 13, Agriculture Code, and under equivalent
terms and conditions.
SECTION 15. Section 2310.110(b), Occupations Code, is
amended to read as follows:
(b) A person commits an offense if the person or the
person's representative or agent knowingly:
(1) offers or exposes for sale, hire, or award or sells
an incorrect motor fuel metering device;
(2) possesses an incorrect motor fuel metering device;
or
(3) sells, offers for sale, uses, or possesses for the
purpose of sale or use a device or instrument to be used to falsify
or intended to falsify a [weight or] measure for motor fuel.
SECTION 16. Section 2310.154(a), Occupations Code, is
amended to read as follows:
(a) A person is not required to hold a license issued under
this subchapter if the person:
(1) is a department employee who is performing device
maintenance activities in the scope of the person's duties for the
department;
(2) is the owner or operator of a motor fuel metering
device or an employee of the owner or operator of a motor fuel
metering device and the person:
(A) completely removes the motor fuel metering
device from the location at which the device was installed,
including a device subject to an out-of-order tag, stop-sale order,
security seal, lock, condemnation notice, or other item placed on
the device by the department to prohibit use of the device; and
(B) notifies the department of the motor fuel
metering device's removal not later than the 10th day after the date
the device was removed in the manner provided by commission rule; or
(3) performs device maintenance activities only on a
motor fuel metering device that is:
(A) exempt from the inspection and registration
requirements of Sections 2310.102 and 2310.103 under commission
rules; and
(B) not required to be inspected by other
commission rules[; or
[(4) is a license holder under Subchapter I, Chapter
13, Agriculture Code].
SECTION 17. Section 2310.2012(a), Occupations Code, is
amended to read as follows:
(a) Except as provided by Subsection (b), a distributor,
supplier, or wholesaler[, or jobber] of motor fuel may not deliver
to an outlet in this state a motor fuel mixture that contains
ethanol or methanol exceeding one percent by volume of the mixture
unless, at the time of the delivery of the mixture, the person also
delivers to the outlet receiving the delivery a manifest, bill of
sale, bill of lading, or other document evidencing delivery of the
mixture, that includes a statement containing:
(1) the percentage of ethanol or methanol contained in
the mixture; and
(2) the types and percentages of any associated
cosolvents contained in the mixture.
SECTION 18. Sections 2310.2013(b), (c), and (d),
Occupations Code, are amended to read as follows:
(b) Each distributor, supplier, and wholesaler[, and
jobber] of motor fuel shall keep a copy of each document required to
be delivered to the dealer by Section 2310.2012 until the fourth
anniversary of the delivery date.
(c) The department or an authorized representative of the
department may inspect documents described by this section. On
written notice issued by the department or an authorized
representative of the department to any employee at a dealer's
[station or] retail motor fuel facility [outlet] or mailed to the
principal place of business of a dealer, distributor, supplier, or
wholesaler, [or jobber,] the dealer, distributor, supplier, or
wholesaler[, or jobber] shall provide the department or authorized
representative of the department with the documents described by
this section within the period specified in the notice.
(d) The commission by rule may:
(1) require each dealer, distributor, supplier, and
wholesaler[, and jobber] to maintain and make available to the
department:
(A) invoices, receipts, or other transmittal
documents or records, including electronically stored information,
showing or describing the purchase, sale, delivery, or distribution
of motor fuel;
(B) invoices, receipts, work orders, reports, or
other documents, including electronically stored information,
showing or describing the installation, maintenance, or repair of:
(i) motor fuel dispensing devices; and
(ii) any equipment used in connection with
motor fuel dispensing devices to record, display, or produce
receipts or audit trails concerning the purchase, sale, delivery,
or distribution of motor fuel; and
(C) any record or other document related to the
sampling and testing of motor fuel purchased, sold, delivered, or
distributed by the dealer, distributor, supplier, or wholesaler[,
or jobber]; and
(2) prescribe:
(A) the manner of filing documents or records
required to be kept under this section or by commission rule; and
(B) the time, place, and manner of inspection of
the documents or records.
SECTION 19. Sections 2310.2014(b) and (c), Occupations
Code, are amended to read as follows:
(b) Each distributor, [or] supplier, or wholesaler shall
keep for at least one year at the distributor's, [or] supplier's, or
wholesaler's principal place of business a copy of each delivery
ticket or letter of certification required to be delivered by the
distributor, [or] supplier, or wholesaler to a dealer in this state
under 16 C.F.R. Part 306.
(c) The department or an authorized representative of the
department may inspect a document required to be kept under this
section. On written notice issued by the department or an
authorized representative of the department to any employee at a
dealer's [station or] retail motor fuel facility [outlet] or mailed
to the dealer's principal place of business, the dealer shall
provide the department or authorized representative of the
department with the documents described by this section within the
period specified in the notice.
SECTION 20. Section 2310.2015(b), Occupations Code, is
amended to read as follows:
(b) A distributor, wholesaler, or supplier of motor fuel may
not deliver or transfer to a dealer in this state motor fuel that
has an automotive fuel rating lower than the certification of the
rating the distributor, wholesaler, or supplier is required to make
to the dealer under federal law.
SECTION 21. Sections 2310.203(a), (c), and (d), Occupations
Code, are amended to read as follows:
(a) The department or an authorized [a] representative of
the department may collect samples and conduct testing at any
location where motor fuel is kept, transferred, sold, or offered
for sale to verify that the motor fuel complies with the minimum
standards required by Section 2310.202. A person who holds a
license issued under Subchapter D is considered an authorized
representative of the department for purposes of this section.
(c) On arriving at a facility to conduct testing under
Subsection (a), the department or an authorized [a] representative
of the department shall notify the owner or manager of the facility
of the department's or representative's presence and purpose. The
department or representative shall follow the most recent
applicable procedures specified by the American Society for Testing
and Materials (ASTM) International Standard D4057, D4177, D5842, or
D5854 for the collection, sampling, and handling of fuel to prepare
for laboratory analysis.
(d) A person commits an offense if the person refuses to
allow the [a] department or an authorized representative of the
department to collect samples or conduct motor fuel testing under
Subsection (a).
SECTION 22. Sections 2310.207(a) and (b), Occupations Code,
are amended to read as follows:
(a) If a dealer or a distributor, supplier, or wholesaler[,
or jobber] of motor fuel violates Section 2310.201, 2310.2012,
2310.2013, 2310.2014, or 2310.2015, a person [motor fuel user] who
purchased the motor fuel and sustained damages or who has a
complaint about the product may bring an action against the dealer,
distributor, supplier, or wholesaler[, or jobber].
(b) The action may be brought, without regard to the
specific amount of damages, in the district court in any county in
which:
(1) the dealer, distributor, supplier, or
wholesaler[, or jobber] transacts business; or
(2) the dealer resides.
SECTION 23. Section 2310.208, Occupations Code, is amended
to read as follows:
Sec. 2310.208. CIVIL PENALTY. A dealer, distributor,
supplier, or wholesaler[, or jobber] who violates Section 2310.201,
2310.2012, 2310.2013, 2310.2014, or 2310.2015 is liable to this
state for a civil penalty of not less than $200 and not more than
$10,000.
SECTION 24. The following provisions of the Occupations
Code are repealed:
(1) Sections 2310.001(a)(10), (a)(11), and (b);
(2) Section 2310.101(b);
(3) Section 2310.106(e);
(4) Section 2310.2001; and
(5) Section 2310.203(b).
SECTION 25. (a) Not later than February 1, 2022, the
presiding officer of the Texas Commission of Licensing and
Regulation shall appoint members to the Motor Fuel Metering and
Quality Advisory Board in accordance with Section 2310.032,
Occupations Code, as added by this Act.
(b) Notwithstanding Section 2310.033, Occupations Code, as
added by this Act, in making the initial appointments to the Motor
Fuel Metering and Quality Advisory Board, the presiding officer of
the Texas Commission of Licensing and Regulation shall designate
three members of the advisory board to serve terms expiring
February 1, 2023, four members to serve terms expiring February 1,
2025, and four members to serve terms expiring February 1, 2027.
SECTION 26. (a) The changes in law made by this Act to
Chapter 2310, Occupations Code, do not affect the validity of a
proceeding pending before a court or other governmental entity on
the effective date of this Act.
(b) An offense or other violation committed before the
effective date of this Act is governed by the law in effect on the
date the offense or violation was committed, and the former law is
continued in effect for that purpose. For purposes of this section,
an offense or violation was committed before the effective date of
this Act if any element of the offense or violation was committed
before that date.
SECTION 27. This Act takes effect September 1, 2021.
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