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NEW YORK -- It's almost become gas-station folklore that credit card companies make more on the sale of a gallon of gas than the retailer who sells it.
That there's something wrong with this picture finally elicited action in Washington in the form of Congressman Peter Welch of Vermont, who co-sponsored legislation to correct the inequities, and has introduced separate legislation calling for more transparency on credit card fees.
"Working closely with the Vermont Grocers Association (VGA) and other retail groups, Congressman Welch convened a forum in his office earlier this year, and more recently chose Kurrle Fuels, a VGA member convenience store, to announce his proposal," said Jim Harrison, president of the VGA.
Congressman Welch's bill will require credit card companies to disclose their interchange rates, terms and conditions to businesses and the public. In addition, his bill will empower the Federal Trade Commission to review these rates and rules, and prohibit practices that violate consumer-protection or anti-competitive laws.
"Peter Welch has been a real friend to our industry on this issue," said Harrison. "He deserves our thanks."
In a vivid demonstration of what a state association can accomplish, the Maine Oil Dealers Association (MODA) introduced, drafted and campaigned for the repeal of costly Stage II vapor recovery requirements -- and the state legislature, in its wisdom, passed the repeal.
The governor signed the bill into law, and as of Jan. 1, 2012, gas stations in Maine's southern three counties with an annual throughput of 1,000,000 gallons or more will be exempt from Stage II requirements. And, effective immediately, stations that exceed 1,000,000 gallons for the first time after Jan. 1, 2008, will also be exempt.
"The repeal exempts Maine's gas stations from the costly retrofits and renovations that were previously required and installations that could cost thousands of dollars for even the smallest station," said MODA president, Jamie Py. "We're grateful to the state legislature and governor for providing this relief for our members, relief that will keep the cost of doing business in Maine down and, as a result, help keep prices in check."
On another front, the Maine Grocers Association (MGA) is taking a leading role in efforts to repeal a new initiative, Public Law 629, that would raise taxes on beer, wine and some non-alcoholic beverages to the tune of $40 million.
The law's purpose is to continue providing health insurance for Maine's citizens under its Dirigo Health program, according to supporters. The program takes its name from the state motto, Dirigo, which means "to lead."
However, "the Dirigo program is flawed and has been unable to sustain itself since its inception in 2005," said Amie Joseph, MGA executive director. "Its funding needs should be addressed with existing General Fund revenues, not through burdensome new taxes laid on the backs of our state's consumers."
The People's Veto is an electoral instrument being used to place the initiative on a ballot for a vote, if a sufficient number of signatures are collected in its support. The required number of signatures is 10 percent of the votes cast in the last gubernatorial election, totaling 55,087.
Several local groups are gathering signatures, along with the Fed-up With Taxes Coalition, which has hired the National Petition Management to round up signers for the People's Veto.
The only wine and liquor wholesaler in the state of New Hampshire is the State Liquor Commission, which is also the only retailer of spirits. However, it retails wines along with food stores and offers food stores wholesale prices that are 20 percent below shelf prices, which is known as the RAW (Regulatory-Adjusted-Wholesale) Cost.
Last year, grocers, which sell 65 percent of all the wine in the state, grew their wine sales by 7.5 percent, while state liquor stores grew only 3 percent. While this would ordinarily elicit praise, the commission has decided to reduce its RAW percentage as a result.
"The Liquor Commission, backed by the governor, has recommended reducing the 20 percent discount in wholesale prices to food stores to 10 percent," said John Dumais, president of the New Hampshire Retail Grocers Association (NHGA). "That would inevitably result in higher retail prices for wine at grocery stores, yet it's the commission's belief that consumers will readily accept the higher costs. Or, says the commission, as an alternative, the affected retailers could absorb the increased cost -- two concepts that are unbelievably naïve."
In a separate section of the proposal, the Liquor Commission is given discretion not to implement the reduction if it does not wish to, suggesting that the reduction would only be triggered if the commission was not meeting its revenue projections.
"This is not very comforting to category managers who have to plan their promotions at least eight weeks in advance," said Dumais. "We've discussed this with Governor Lynch, pointing out that if this proposal remains in place, buyers would be forced to be more cautious in planning their promotions, which would lower state and retail revenues.
"NHGA's first initiative is to convince the state to provide retailers with at least a 90 day notice of any change in the RAW cost," said Dumais. "It's hoped that the state will work with grocers to find better alternatives. This is an issue that will remain a high priority with NHGA and its members for at least the next 12 months."