"In order for small retailers to generate funds to replenish their inventory, [image-nocss] the replacement cost has to be taken into consideration, as it has been in other states," Tudor told the Journal-Constitution.
But Officials with the Governor's Office of Consumer Affairs said they worry that the measure, if it becomes law in its current form, would make it tough to prosecute a gas station for price gouging.
"I think it would be very difficult to determine that price gouging had occurred," Bill Cloud, spokesperson for the office, told the newspaper. "I don't know that we would have confidence in saying that, as the bill exists right now, we would be able to define or describe or enforce price gouging as it relates to petroleum products."
The bill was originally meant to give the governor more flexibility in deciding which products would fall under gouging laws during an emergency, said the report. For example, if an emergency involved damage to homes but not a disruption in the flow of gasoline, gouging laws could apply to plywood or building materials and not fuel.
However, the bill, which was backed by Governor Sonny Perdue, was rewritten by the State Senate Agriculture & Consumer Affairs Committee to allow stations, in an emergency, to charge for gasoline what they decide it will cost to replenish the fuel they have on site.
If a station bought gasoline for $2 a gallon and was initially selling it for $2.10 a gallon, under the bill, the station could immediately raise prices to $4 a gallon in an emergency if that is what they determine the price would be to refill the tanks once the fuel is gone, the report said.
Under current state law, stations are prohibited from making greater profits once the governor designates an emergency.
The governor's office objects to the change and is working with lawmakers and lobbyists to rewrite the Senate bill, said the report. The language allowing the higher prices may be removed from the bill before the House votes on it, it added.
The Senate bill was sponsored by Jeff Mullis (R), who said it was not his intention to allow stations to immediately charge the higher price to replenish their inventory. He said it was redone in the Senate committee. "I hope they change that," Mullis told the paper.
The committee's chairman, John Bulloch (R), said the change was made because in an emergency, retailers of other products, such as plywood, are allowed to charge the higher prices immediately.
"Right now, the state allows, during the state of emergency, for replacement cost pricing for plywood, which is a very volatile product," added Tudor. "What we have attempted to show the state is that motor fuel is even more volatile."
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