Thursday, May 10, 2007

Wisconsin forces gas station owner to raise his prices

Kind of a self-fulfilling prophecy, isn't it? Make a gas station owner raise his rates, then bellyache that Big Oil is responsible for high prices. Brilliant. Anywho, from the AP:
A service station that offered discounted gas to senior citizens and people supporting youth sports has been ordered by the state to raise its prices.

Center City BP owner Raj Bhandari has been offering senior citizens a 2 cent per gallon price break and discount cards that let sports boosters pay 3 cents less per gallon.

But the state Department of Agriculture, Trade and Consumer Protection says those deals violate Wisconsin's Unfair Sales Act, which requires stations to sell gas for about 9.2 percent more than the wholesale price.

Bhandari said he received a letter from the state auditor last month saying the state would sue him if he did not raise his prices. The state could penalize him for each discounted gallon he sold, with the fine determined by a judge.

Bhandari, who bought the station a year ago, said he worries customers will think he stopped the discounts because he wants to make more money. About 10 percent of his customers had used the discount cards.

Dale Van Camp said he bought a $50 card to support the local youth hockey program. It would have saved him about $100 per year on gas, he said.

How crazy is that? "Raise your prices 9.2% or we'll sue! We're doing this for the consumers." Yeah, I'm sure they love the higher gas prices you just gave them.

Here in FL, we have a state law that forbids companies from selling their gas below their cost. The purpose of the law, whether you agree with it or not, is that it keeps companies with better cash flow from driving their competitors out of business, which would in turn allow the surviving companies to raise their rates once the competition has been eliminated. I submit to you that FL's law is different, in that owners can sell AT their cost, while WI picks a number out of their butts (9.2%) to tack on to the owner's cost.

If government wants to "do something" about the price of gas, they could start by getting their hands out of the cookie jar! Government doesn't have anything to do with the finding, procuring, refining, or distributing of gas, but the Big Leech will take a big bite out of every gallon that you pump. According to the DOE (2005 data, but the percentages have changed very little), federal excise taxes account for about 18.4 cents per gallon, while state excise taxes average 21 cents per gallon (eleven States levy additional State sales and other taxes, some of which are applied to the Federal and State excise taxes). That's not even counting city or county taxes.

In other words, the government is responsible for 40+ cents per gallon. And Wisconsin's response? "Charge more!"