FOR IMMEDIATE RELEASE: September 19, 2005
Schumer Releases New Survey Showing Shocking Disparity in Buffalo Gas Prices –Proposes Creating Investigative Authority for FTC Triggered By Energy Emergencies
Hurricane Katrina-Related Gas Price Gouging Escalating Costs for Western New Yorkers, With No Decisive Action, Could Continue Long After Clean-Up Period
In light of shocking disparities in gas prices in Buffalo U.S. Senator Charles E. Schumer today called for the creation of stronger tools for the Federal Trade Commission (FTC) to examine price gouging. Schumer will release a survey that shows the range of gas prices throughout Erie County and express serious concern that people could be profiting in the wake of the devastation caused by Hurricane Katrina.
“We are only beginning to comprehend the breadth of what truly is a devastating national tragedy,” Schumer said. “Hurricane Katrina has destroyed homes, communities, families, and an entire region of this nation. The thought that a few bad apples might profit from this tragedy is unconscionable.”
According to AAA, Buffalo gas prices are up 65% since last year and 27% since a month ago, before Hurricane Katrina. New York State has the high gas prices throughout the country, except for Hawaii and Washington, DC.
Schumer released a survey of gas prices in Buffalo. The survey, which was done over the weekend, showed a wide range of prices for a tank of regular gas across Erie and Niagara Counties. In Erie County, for example, prices differed as much as 54 cents between one of the higher prices stations and one of the lower priced stations. The complete survey is attached.
Though some of the increase in gas prices can be attributed to the interruption in oil and refined gas supplies, and the uncertainties of such an unprecedented and unpredictable event as Hurricane Katrina, Schumer expressed fear that some of the fluctuation and inconsistencies in gas prices are a result of price gouging at the pump.
Across the Northeast, gas prices have surged from pre-Katrina levels. Market forces have certainly played a role in these prices, but the variety of prices at gas stations and the fact that profits continue to flow to big oil indicate improper pricing. There are currently no federal laws that specifically address price gouging. The state laws that do exist regarding price gouging are usually only triggered in situations arising from a declared emergency.
In an effort to crackdown on any possible price gouging, Schumer today called on the Federal Trade Commission to launch a top-to-bottom investigation to make sure that oil companies and gas station owners and the pipeline in between them are operating ethically and within the law. Though the Federal Trade Commission already monitors gas prices and investigates possible antitrust violations in the petroleum industry, Schumer called for the immediate formation of a task force to promptly identify the many cases of price gouging being reported across the country, and asked that the task force formulate a process by which price gougers are swiftly prosecuted.
There are currently no federal laws that specifically address price gouging. The state laws that do exist regarding price gouging are usually only triggered in situations arising from a declared emergency. Schumer and Corzine, in a letter to the FTC asked for the Commission’s recommendations on the most effective way to strengthen the federal government’s authority in this area.
In addition, Schumer also called for:
• The creation of an emergency authority at FTC to investigate gasoline price gouging if President makes an Energy Emergency declaration. If the President declares an energy emergency, the FTC would be empowered to investigate price gouging throughout the nation. Currently, there is no federal anti-gouging authority. The FTC, an independent regulatory commission, would conduct the investigation and would be authorized to fine companies for price gouging versus the more traditional remedies such as cease and desist orders and requiring that companies disgorge profits after the fact.
• A robust campaign encouraging consumers to report price gouging, including a new Web site and toll free number.
• Increased funding for emergency Low Income Heating Energy Assistance funds in a comprehensive spending bill. Schumer urged the Senate Appropriations Committee to include $1.276 billion in emergency Low Income Heating Energy Assistance funds in a comprehensive spending bill. $1.276 billion is the money needed to just maintain LIHEAP purchasing power compared to last year. Schumer also joined a bipartisan coalition of Senators asking the Administration to support increased funding for weatherization and state energy programs and an energy education campaign to help consumer and businesses address the high cost of residential energy, including $500 million for weatherization, $100 million for the state energy program, and $90 million for the energy education campaign.