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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