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Bush Urged to Suspend Gas Tax; Price Gouging Probed

Posted on: Wednesday, 7 September 2005, 18:00 CDT

Sep. 7--Democratic state senators called on Gov. Jeb Bush Tuesday to suspend the Florida gas tax for at least a month to help ease the pinch for consumers at the pump. Bush later told reporters that his office was studying the issue.

At the same time, Florida Agriculture and Consumer Services Commissioner Charles Bronson announced Tuesday that he had issued subpoenas for all 19 oil companies that bring fuel into the state. It's part of an expanding price gouging investigation in the wake of Hurricane Katrina.

Florida Attorney General Charlie Crist said Tuesday his office will decide this week whether to subpoena owners of at least 10 Florida gas stations, including one in Broward County, that investigators found raised prices as much as 85 cents in 48 hours.

As government leaders grappled with ways to deal with the skyrocketing gas prices, the good news for consumers is that the situation at the pumps Tuesday was improving slightly. Supplies continue to improve everywhere in the state except the Panhandle, and prices may have peaked over the weekend.

"Things are looking up," said Randy Bly, spokesman for AAA Auto Club South. "I think we'll start to see prices leveling off this week and dropping in certain markets. It's going to be a trickle down. We should get below $3 a gallon by the end of this week."

The hope is that prices in Florida will get back to the neighborhood of $2.50 per gallon by October or shortly after, industry experts said.

But Sen. Walter "Skip" Campbell, D-Tamarac, said something needs to be done now to help the thousands of middle class people who say they can't afford the extra money to pay for rising gas prices.

"People are going into their savings accounts to pay for gas. That's unacceptable," said Campbell, who along with Sen. Lesley "Les" Miller, D-Tampa, called on Bush to suspend the gas tax. "We have a crisis. Someone has to stand up for the common people. If not their elected officials, than who?"

Campbell and Miller join a string of Democratic lawmakers who have seized on the gas tax issue as prices at the pump have risen and the election season draws near.

Sen. Ron Klein and Rep. Irv Slosberg, Democrats from Delray Beach and Boca Raton, also called for a rollback in gas prices.

Democratic gubernatorial candidate and former Tallahassee Mayor Scott Maddox on Tuesday urged Bush to call a special session to temporarily suspend the gas tax.

Bush said the Democrats' call for a gas tax rollback was "very good news for Florida because, historically, they have been opposed to tax cuts."

But Bush spokesman Russell Schweiss said initial indications are that it would take a legislative act to repeal the gas tax. Bush said he would support such a move if legislators return this year for a special session.

The Florida Legislature last year approved a one-month, eight-cents-a-gallon reprieve in the 14.3-cent gas tax. The tax break cost the state $59.7 million in lost revenues.

Florida officials also want some answers on why prices are rising so much.

Bronson issued the subpoenas Tuesday to all the major oil companies -- including Exxon Mobil Corp., Chevron USA and BP Corp. North America -- to determine how much they paid for fuel and what they sold it for.

"We're not alleging any wrongdoing," said Terence McElroy, spokesman for the Department of Agriculture and Consumer Services.

"We know people are paying an awful lot for gas. We've got to satisfy ourselves that no one is lining their pockets with increased profits."

It is against Florida law to charge "excessive" or "exorbitant" prices for essential items during an emergency, unless the increase in price is attributable to additional costs incurred by the seller. Individuals or businesses found to have engaged in price gouging can face fines of up to $1,000 per violation or up to $25,000 a day.

Crist said his office is investigating 48-hour price increases at 10 stations around the state, including an 85-cents per gallon jump at a Swifty Foods store in Tallahassee and 54-cents per gallon at a Shell station on South Andrews Avenue in Broward.

"Unfortunately, there is not a whole lot of logic to this," Crist said.

David Mica, executive director of the Florida Petroleum Council, criticized the timing of Bronson's subpoenas and Crist's investigation.

"People are trying to get gas to consumers," Mica said. "We're still working in emergency mode."

While Gulf Coast petroleum operations have started to get back on their feet, supplies aren't back to normal levels.

The Florida Department of Environmental Protection said Tuesday that there were more than 138 million gallons of fuel, including 109.3 million gallons of gasoline, available for distribution in the state.

Over the next nine days, more than 40 ships will deliver an additional 191 million gallons of fuel to Florida.

At Port Everglades there are 40.9 million gallons of fuel in storage, with another 56.4 million gallons expected over the next three days.

"We've probably got another two weeks until we get to the point where there is gas at every station, every day," said Jim Smith, president of the Florida Petroleum Marketers and Convenience Store Association, whose reports showed that 76 percent of South Florida stations were at normal levels Tuesday.

Fuel costs in South Florida also seemed to stabilize as the work week began, with some stations actually dropping their prices from where they were just a day or two ago.

The average price for a gallon of unleaded inched up to $2.99 Tuesday in a Herald survey of 81 gas stations, up two cents from Friday's survey. That marked a major change in pace for the survey, which last week saw gas prices increase about a dime per day.

Herald staff writers Theresa Bradley, Matthew Haggman, Douglas Hanks, Monica Hatcher, Mary Ellen Klas, Amy Martinez, Patrick Ogle and Jim Wyss contributed to this report.

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XOM, CVX, BP,

Source: The Miami Herald

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