Propane Caucus, Tax Credits Among Top Issues for Propane Days

Attracting members of Congress to the Congressional Propane Caucus, extending motor fuel tax credits, achieving parity with natural gas in Corporate Average Fuel Economy (CAFE) standards, and calculating the excise tax for propane on an energy content basis will be four primary areas of focus for the propane industry at Propane Days this month in Washington, D.C.

On May 21, Congressmen Robert E. Latta (R-Ohio) and Tim Walz (D-Minn.) announced the founding of the Congressional Propane Caucus. Latta and Walz have agreed to chair the caucus, and asking members of Congress to join will be a primary goal in the propane industry’s meetings with legislators. The caucus will be made up of legislators who have shown interest in propane issues in the past, and with whom the propane industry could work in the future.

Extending the motor fuel tax credits that expired at the end of last year and passing an excise tax equalization bill are two other actions that propane industry attendees at Propane Days will ask Congress members to take. Phil Squair, National Propane Gas Association (NPGA) senior vice president of governmental affairs, told BPN on May 4 that the issues list could change if additional concerns come up as Propane Days approaches.

Reps. Latta and Walz sponsored the Propane Education and Research Enhancement Act of 2014, which resulted in the lifting of the consumer education restriction on the Propane Education & Research Council. “We’re very happy to continue working with them,” Squair stressed.

The caucus is being set up as a means to communicate, Squair added, and the need for that was amplified during the supply and infrastructure challenges of the winter of 2013-2014.

“We have many things to tell the Hill, and the Hill is very concerned about deliverability issues and infrastructure changes. Members of Congress who have a particular interest in learning and staying abreast of propane issues can join the propane caucus and keep in touch with what we’re doing. It will be a two-way street: They will be able to hear from us, and we will be able to send things directly to the caucus, those who have expressed interest in our issues.”

The “ask” of the Congress members at Propane Days will be for them to join the caucus. In addition to Latta and Walz as co-chairs, eight additional congress members agreed to join the caucus as of May 21.

Extending the 50-cent-per-gallon tax credit for propane autogas and the refueling infrastructure tax credit have been on past Propane Days “ask” lists, and will be on the list of issues for the propane industry to discuss with legislators and their staff members again this year. Squair has said that Congress members are currently awaiting action on broad tax reform issues before taking a public position in favor of tax credits and extenders, but the propane-related ones are important to the industry.

Propane industry members will also work to persuade legislators to extend Section 179 expensing and bonus depreciation. Section 179 allows small business owners to immediately deduct the cost of investments in property, equipment, and computer software rather than depreciating such costs over time. According to Squair, that gives owners flexibility to reinvest in their business and simplifies their accounting practices, adding that the provisions “would also help companies on the near term make investments and do the things they do and give a little bit of certainty to these companies that don’t have it right now.”

Convincing legislators to support excise tax equalization bills currently in the House and Senate is another area that the propane industry plans to emphasize at Propane Days. The bills call for calculating the propane excise tax on an energy content basis rather than on a per-gallon basis. Because a gallon of propane has less energy content than a gallon of gasoline, a calculation based on energy content will reduce the excise tax on propane as a motor fuel, currently at 18.3 cents, to 13.4 cents. A decrease in the excise tax, along with reinstating the tax credits, will help propane compete better with gasoline as an engine fuel.

The schedule for Propane Days was still preliminary when Squair spoke to

. NPGA will hold its board of directors meeting on June 8. To start the Propane Days schedule on June 9, NPGA will present a legislative briefing in the morning to provide more detail on topics in the issue briefs. At press time, NPGA had invited Latta to be a guest speaker to expand on the benefits of the Propane Caucus and other issues. Charles Krauthammer, a Washington Post political columnist and television commentator, will return to give a presentation at Propane Days this year.

“I know people really enjoyed him last year,” Squair commented. “With all the talk already happening about the presidential election and the various personalities that are involved, and the challenges we have in foreign policy, he’s going to have a pretty compelling presentation.” —Daryl Lubinsky