109th CONGRESS
2d Session

S. 2830

To amend the automobile fuel economy provisions of title 49, United States Code, to reform the setting and calculation of fuel economy standards for passenger automobiles, and for other purposes.

IN THE SENATE OF THE UNITED STATES

May 18, 2006

Mr. LOTT (for himself and Mr. PRYOR) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation

A BILL

To amend the automobile fuel economy provisions of title 49, United States Code, to reform the setting and calculation of fuel economy standards for passenger automobiles, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the `Corporate Average Fuel Economy Reform Act of 2006'.

SEC. 2. CAFE STANDARDS FOR PASSENGER AUTOMOBILES.

    (a) AVERAGE FUEL ECONOMY STANDARDS FOR AUTOMOBILES- Section 32902 of title 49, United States Code, is amended--

      (1) by striking subsections (b) and (c) and inserting the following:

    `(b) Passenger Automobiles-

      `(1) IN GENERAL- At least 18 months before the beginning of each model year, the Secretary of Transportation shall prescribe by regulation average fuel economy standards for passenger automobiles manufactured by a manufacturer in that model year. Each standard shall be the maximum feasible average fuel economy level that the Secretary decides the manufacturers can achieve in that model year. The Secretary may prescribe separate standards for different classes of passenger automobiles.

      `(2) MINIMUM STANDARD- In prescribing a standard under paragraph (1), the Secretary shall ensure that no manufacturer's standard for a particular model year is less than the greater of--

        `(A) the standard in effect on the date of enactment of the Corporate Average Fuel Economy Reform Act of 2006; or

        `(B) a standard established in accordance with the requirement of section 5(c)(2) of that Act.

    `(c) Flexibility of Authority-

      `(1) IN GENERAL- The authority of the Secretary to prescribe by regulation average fuel economy standards for automobiles under this section includes the authority to prescribe standards based on one or more vehicle attributes that relate to fuel economy, and to express the standards in the form of a mathematical function. The Secretary may issue a regulation prescribing standards for one or more model years.

      `(2) REQUIRED LEAD-TIME- When the Secretary prescribes an amendment to a standard under this section that makes an average fuel economy standard more stringent, the Secretary shall prescribe the amendment at least 18 months before the beginning of the model year to which the amendment applies.

      `(3) NO ACROSS-THE-BOARD INCREASES- When the Secretary prescribes a standard, or prescribes an amendment under this section that changes a standard, the standard may not be expressed as a uniform percentage increase from the fuel-economy performance of automobile classes or categories already achieved in a model year by a manufacturer.';

      (2) by inserting `motor vehicle safety, emissions,' in subsection (f) after `economy,';

      (3) by striking `energy.' in subsection (f) and inserting `energy and reduce its dependence on oil for transportation.';

      (4) by striking subsection (j) and inserting the following:

    `(j) COMMENTS FROM DOE AND EPA-

      `(1) NOTICE OF PROPOSED RULEMAKING- Before issuing a notice proposing to prescribe or amend an average fuel economy standard under subsection (a), (b), or (g), the Secretary of Transportation shall give the Secretary of Energy and the Administrator of the Environmental Protection Agency at least 10 days to comment on the proposed standard or amendment. If the Secretary of Energy or the Administrator concludes that the proposed standard or amendment would adversely affect the conservation goals of the Department of Energy or the environmental protection goals of the Environmental Protection Agency, respectively, the Secretary or the Administrator may provide written comments to the Secretary of Transportation about the impact of the proposed standard or amendment on those goals. To the extent that the Secretary of Transportation does not revise a proposed standard or amendment to take into account the comments, if any, the Secretary shall include the comments in the notice.

      `(2) NOTICE OF FINAL RULE- Before taking final action on a standard or an exemption from a standard under this section, the Secretary of Transportation shall notify the Secretary of Energy and the Administrator of the Environmental Protection Agency and provide them a reasonable time to comment on the standard or exemption.'; and

      (5) by adding at the end thereof the following:

    `(k) COSTS-BENEFITS- The Secretary of Transportation may not prescribe an average fuel economy standard under this section that imposes marginal costs that exceed marginal benefits, as determined at the time any change in the standard is promulgated.'.

    (b) EXEMPTION CRITERIA- The first sentence of section 32904(b)(6)(B) of title 49, United States Code, is amended--

      (1) by striking `exemption would result in reduced' and inserting `manufacturer requesting the exemption will transfer';

      (2) by striking `in the United States' and inserting `from the United States'; and

      (3) by inserting `because of the grant of the exemption' after `manufacturing'.

    (c) CONFORMING AMENDMENTS-

      (1) Section 32902 of title 49, United States Code, is amended--

        (A) by striking `or (c)' in subsection (d)(1);

        (B) by striking `(c),' in subsection (e)(2);

        (C) by striking `subsection (a) or (d)' each place it appears in subsection (g)(1) and inserting `subsection (a), (b), or (d)';

        (D) by striking `(1) The' in subsection (g)(1) and inserting `The';

        (E) by striking subsection (g)(2); and

        (F) by striking `(c),' in subsection (h) and inserting `(b),'.

      (2) Section 32903 of such title is amended by striking `section 32902(b)-(d)' each place it appears and inserting `subsection (b) or (d) of section 32902'.

      (3) Section 32904(a)(1)(B) of such title is amended by striking `section 32902(b)-(d)' and inserting `subsection (b) or (d) of section 32902'.

      (4) The first sentence of section 32909(b) of such title is amended to read `The petition must be filed not later than 59 days after the regulation is prescribed.'.

      (5) Section 32917(b)(1)(B) of such title is amended by striking `or (c)'.

SEC. 3. USE OF EARNED CREDITS.

    Section 32903 of title 49, United States Code, is amended--

      (1) by striking `3 consecutive model years' in subsection (a)(1) and subsection (a)(2) and inserting `5 consecutive model years';

      (2) by striking `3 model years' in subsection (b)(2) and inserting `5 model years';

      (3) by redesignating subsection (f) as subsection (g); and

      (4) by inserting after subsection (e) the following:

    `(f) CREDIT TRANSFERS- The Secretary of Transportation may permit by regulation, on such terms and conditions as the Secretary may specify, a manufacturer of automobiles that earns credits to transfer such credits attributable to one of the following production segments in a model year to apply those credits in that model year to the other production segment:

      `(1) Passenger-automobile production.

      `(2) Non-passenger-automobile production.

    In promulgating such a regulation, the Secretary shall take into consideration the potential effect of such transfers on creating incentives for manufacturers to produce more efficient vehicles and domestic automotive employment.'.

SEC. 4. USE OF CIVIL PENALTIES FOR RESEARCH AND DEVELOPMENT.

    Section 32912 of title 49, United States Code, is amended by adding at the end thereof the following:

    `(e) Research and Development and Use of Civil Penalties-

      `(1) All civil penalties assessed by the Secretary or by a Court shall be credited to an account at the Department of Transportation and shall be available to the Secretary to carry out the research program described in paragraph (2).

      `(2) The Secretary shall carry out a program of research and development into fuel saving automotive technologies and to support rulemaking related to the corporate average fuel economy program.'.

SEC. 5. EFFECTIVE DATE.

    (a) IN GENERAL- Except as provided in subsection (b), this Act, and the amendments made by this Act, take effect on the date of enactment of this Act.

    (b) TRANSITION FOR PASSENGER AUTOMOBILE STANDARD- Notwithstanding subsection (a), and except as provided in subsection (c)(2), until the effective date of a standard for passenger automobiles that is issued under the authority of section 32902(b) of title 49, United States Code, as amended by this Act, the standard or standards in place for passenger automobiles under the authority of section 32902 of that title, as that section was in effect on the day before the date of enactment of this Act, shall remain in effect.

    (c) RULEMAKING-

      (1) INITIATION OF RULEMAKING UNDER AMENDED LAW- Within 60 days after the date of enactment of this Act, the Secretary of Transportation shall initiate a rulemaking for passenger automobiles under section 32902(b) of title 49, United States Code, as amended by this Act.

      (2) AMENDMENT OF EXISTING STANDARD- Until the Secretary issues a final rule pursuant to the rulemaking initiated in accordance with paragraph (1), the Secretary shall amend the average fuel economy standard prescribed pursuant to section 32092(b) of title 49, United States Code, with respect to passenger automobiles in model years to which the standard adopted by such final rule does not apply..AEMD23AF

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