IL SB3224

Amends the Motor Fuel Tax Law to define "alternative fuel" as compressed natural gas, liquefied natural gas, liquefied petroleum gas, and blending products like ethanol, butane, and soy oil used with gasoline or diesel fuel.

Requires alternative fuel suppliers to obtain licenses from the Department of Revenue and establishes tax collection and reporting requirements for alternative fuel sales, with monthly returns due between the 1st and 20th of each month.

Exempts alternative fuel from prepayment requirements under the Retailers' Occupation Tax Act and allows licensed distributors, suppliers, and receivers to engage in blending without being classified as blenders.

Clarifies that retail blenders selling motor fuel blended by purchasers through blender pumps are considered blenders and establishes specific tax exemptions for alternative fuel sales to certain entities including the Federal Government and municipal transportation systems.

Updates recordkeeping, inspection, and penalty provisions to include alternative fuel suppliers and their operations alongside existing motor fuel distributor and supplier requirements.