Senate advances bill to merge clean-fuels loan funds, seek federal match to spur vehicle conversions

Senate sponsors advanced legislation Tuesday to reshape the state—s Clean Fuels Loan Program, consolidating separate public and private conversion loan funds and authorizing the state to seek $330,000 in general-fund appropriation to obtain an equal federal match.

Senator McAllister, the floor sponsor of SB68, told colleagues the bill would merge the two existing accounts into a single revolving fund and remove fixed per-conversion dollar caps so that the state "would reimburse them for the amount of costs incurred in converting from the current fuel to the clean fuel." He said the change aims to make conversions more appealing and to increase public-sector participation.

The bill would set loan interest for public-sector vehicle conversions at 0 percent, while private borrowers would still pay an interest rate tied to the state treasurer—s investment pool. McAllister said the combined fund currently holds about $2.0—2.3 million and that adding the $330,000 appropriation would allow the state to double available dollars by leveraging federal matching funds.

Supporters pressed that the measure serves air-quality goals. "This is a bill that's designed to do that," McAllister said, linking the program to Utah—s need to reduce pollution in noncompliant areas of the Wasatch Front.

Senators asked detailed questions about program uptake and legal authority. McAllister and staff said roughly 22 companies and about 62 vehicles had used the private-side program; fueling infrastructure remained limited, with "approximately 20–25" public refueling sites available now. Senators also raised concerns that the bill might impermissibly lend the state's credit to political subdivisions. In response, program staff and Senate legal counsel said the revolving-loan structure had operated for several years without a written Attorney General objection and that analysts saw no definite constitutional problems with the current design. The president—s office and counsel agreed to obtain additional legal review as needed.

Mister Tingey, who works with the program, described administrative benefits of a single fund and the program—s ability to leverage federal match: "It will reduce administrative burden of administering two different funds," he said, adding that consolidated funds would be more accessible "to whomever is willing to stand out as an example, take some risk."

After extended floor discussion and a committee-of-the-whole review to hear program staff, the Senate called the question. The roll-call output announced that Senate Bill 68 passed third reading with 27 aye votes and 2 absent and will be placed on the calendar for transmission.

What happens next: SB68 will be transmitted to the House for further consideration and implementation details (such as loan terms for private borrowers, the exact appropriation process for matching federal funds, and any legal opinions requested) will be fleshed out in subsequent committee work.