By John Eichberger
Like the swallows returning to San Juan Capistrano, congressional attention this spring has returned to fuel prices and alternative energy resources. Some members have reintroduced legislation to make price gouging a federal offense while others have proposed new incentive programs to bring alternative fuels to market.
In the midst of all this debate, NACS has stepped up to advocate policies that would enable retailers to enter new market opportunities at the lowest cost and with the least amount of risk possible.
On May 5, NACS Chairman Jeff Miller, president of Miller Oil Company in Norfolk, Virginia, testi?ed before the House Energy and Power Subcommittee about the future of fuels: "Let me start by stating that we support the use of renewable fuels and are working hard to expand their use with the motoring public. However, we are in the customer service business and have to make decisions every day regarding what products to sell and which services to offer our customers," he began.
"Choosing to sell a new fuel is very different than choosing to sell a new candy bar," he explained. "As new fuels come onto the market, we want to have a reasonable expectation that we will be able to generate a return on our investment and will have the option to sell them while being in compliance with all laws and regulations. But to do this, we need your assistance."
Miller noted that legal considerations prevent retailers from using existing equipment to sell new fuels €" even when that equipment is technically capable of doing so. In addition, he noted that the liability risks associated with misuse of the fuels or potential repeal of the authorization to sell these fuels must be resolved. Otherwise there€™s no regulatory and legal certainty to retailers that enter new markets.
NACS is working with other stakeholders in the fueling industry to reach agreement on a comprehensive proposal that will resolve the issues facing retailers that are considering new fuel options. At the heart of this is legislation introduced last Congress by Representatives Mike Ross (D-AR) and John Shimkus (R-IL): H.R. 5778. That bill provides a mechanism to recertify existing retail equipment as compatible with new fuels and protect consumers from liability if a consumer ignores warning labels and misfuels their vehicle.
NACS is also pursuing legislation to ensure that no person can be retroactively held liable for selling an authorized fuel today if, in a few years, it is subsequently ruled unlawful.
"If Congress takes action to lower the cost of entry and to remove the threat of unreasonable liability, more retailers may be willing to take a chance and offer a new renewable fuel," Miller concluded. "By lowering the barriers to entry, Congress will give the market an opportunity to express its will and allow retailers to offer consumers more choice. If consumers reject the new fuel, the retailer can reverse the decision without sacrificing a significant investment, but new fuels will be given a better opportunity to successfully penetrate the market."
"The nation€™s convenience and fuel retailers are ready to assist Congress in its consideration of policies that will promote a stable and efficient market for transportation fuels. There are many factors to consider and we hope that policymakers will proceed cautiously and avoid imposing unnecessary and costly burdens on the system."
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By John Eichberger
The flooding and devastating storms that raged throughout the South in recent months potentially carried with them the threat of government activities that may negatively affect our industry. In the aftermath of natural disasters, elected of?cials often promote policies they believe are in touch with the needs of their constituents and so take action to protect their interests. Unfortunately, convenience and fuel retailers sometimes land in the crosshairs of such efforts.
NACS is keeping a lookout for these kinds of misguided initiatives and we encourage you to do the same. If you learn of a policy proposal that may negatively affect your business, let us know. Meanwhile, a couple of ideas have been proposed in the past and may rear their ugly heads yet again:
We all know that retail fuel prices spark consumer unrest and media attention often throughout the year, and proposals to make price gouging a crime are not new. In Congress, legislation to make price gouging a federal offense was recently reintroduced, but support has been limited. The White House, however, has put retailers on notice that it will investigate price gouging and many state attorneys general are taking public positions to protect consumers from the predatory pricing practices.
NACS is working with members of Congress and attorneys general to explain the dynamics of the market. We encourage you to use the 2011 NACS Fuels Report to help explain to your local of?cials how the market works.
When disasters compromise electricity supplies, selling fuel to evacuees or first responders is just not possible. But some public offcials believe that certain retailers, especially those located along emergency routes, should be required to install backup generators that can power fuel dispensers and possibly freezers to ensure the availability of ice. What these offcials don€™t fully understand is the cost of installing such equipment can be prohibitive for many retailers. In addition, incentive programs that benefit some retailers but not others creates an unfair competitive environment.
NACS has worked with some members of Congress to explain the complexities of these programs, but some states have already taken action to implement them. Stay engaged with your state association to ensure you are not surprised by such efforts.
I first became involved with government relations by joining my local neighborhood zoning committee, which has the most in?uence on how I run my business. It was a great opportunity for me to establish relationships with the local politicians who frequently attended our meetings to support an initiative or educate the group.
I strongly believe that meeting your local and national elected of?cials is one of the most important things you can do for your business. At Metro Petro, we government is call it "Government Day" and we treat the meetings vendor no different than meetings with our major vendors.
Because if you think about it, the government is your largest vendor. Each day you make payments to cover property taxes, payroll taxes, sales taxes, fees, licenses and so on.
Metro Petro is a small operator, so ?nding time to engage with government officials can be dif?cult, but I believe it is mandatory for our business to be successful. Even if your time is limited, there are several opportunities to meet and greet your elected officials. I regularly meet with my local state representative at Memorial Day celebrations.
It€™s also important to meet with your representatives when you do not need their assistance or guidance. This way, when the need for assistance arises, a relationship has already been established. Make it your job to meet and educate your elected of?cials once a month. You won€™t find the value of your elected officials in your profit and loss statement, but it will appear on a net worth statement. The return on your investment comes over time.
Getting involved is not difficult. The first step is to educate yourself on the industry issues and about your local elected officials €" even if they are not who you supported or from "your" party. Then, introduce yourself and get to know them. You will be happily surprised at the reception you will receive and the benefits it will provide you and your business.
Clay Lambert
Managing Director
Metro Petro