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By Hank Behar
Washington state's gas stations won a 50 percent tax credit on the cost of installing emergency generator after its oil marketers association made a strong case to state legislators justifying the move; that, in addition to convincing them to kill an alternative fuel tax. Oregon was the site of another double legislative victory when a cigarette tax increase and street maintenance fees on retailers were sidetracked. Meanwhile, Colorado is fighting a Stage II vapor recovery initiative, as well as a Sunday liquor law that will wipe out most of its beer sales. And if you're in Montana, take note: Your next annual conference is scheduled for June.
When a disaster strikes, such as a hurricane or flood, one of the most important resources for rescuers is your neighborhood gas station, where fuel can be obtained for running rescue trucks and other equipment.
But it takes electricity to pump the fuel and one of the first things to go down in an emergency situation is often the power grid -- which is why so many communities now require gas stations to install back-up power generators.
In Washington State, thanks in part to the efforts of the Washington Oil Marketers Association (WOMA), a bill has been passed that awards gas stations a tax credit equal to 50 percent (up to $25,000), of the costs involved in such an installation, including the direct cost of the generator, the labor and ancillary installation costs.
"We expect the governor to sign the bill soon," said Lea Wilson, executive director of WOMA. "Now we plan to work with the Department of Revenue and legislators to implement the bill on a statewide basis."
WOMA also worked to kill a proposal imposing a 2 percent alternative fuel sales mandate on all supplier licenses. "The new requirements would have imposed the 2 percent mandate on each fuel distributor, undermining the concept of allowing for an overall statewide 'volumetric mandate,'" said Charlie Brown, legal advisor and lobbyist for WOMA.
"We also objected to the multiple reporting requirements placed on suppliers and distributors in the bill, as well some ethanol requirements that would have put us at odds with the federal Clean Air Act standards in the urban areas of the state," he said.
As a result of WOMA's participation in the legislation, it has been asked to work with some House members on the entire alternative fuels issue, which could offer an opportunity to modify the bill to make it more workable for WOMA's membership.
Two initiatives in Oregon to increase taxes failed after efforts by their opponents, including the Oregon Neighborhood Store Association, succeeded in sidetracking the measures; both laws would have negatively affected small retailers.
One was an 84.5 cents per-pack tax on cigarettes to pay for various health insurance programs, and the other was a street maintenance fee for transportation improvements -- both laudable goals, but both unfairly burdensome on small retailers.
Cigarette sales are among the largest revenue generators of convenience stores, so an added tax of 84.5 cents a pack would have lowered store income appreciably, This, in effect, would have made c-stores a scapegoat in the anti-smoking wars. The cigarette tax, plus an additional 30 percent tax on the wholesale value of "other tobacco products," was presented to Oregon's voters as an amendment to the state constitution, but was defeated by a 60 percent margin.
The street maintenance fee would have cost small retailers in Portland -- Oregon's largest city -- more than $500 each, but the Oregon Neighborhood Store Association was able to work with other small business organizations to get the proposal reduced by the time of its formal introduction -- and ultimately, helped prevent it from becoming law.
The battle is not over, however, advised Richard Kosesan, political representative of the Oregon Neighborhood Store Association. "Cities across the state have been showing a high level of interest in adopting new street improvement fees to pay for transportation projects," he said. "If recent trends are any indication, local government taxation is going to be a problem for small storeowners in the years to come. It's something we have to watch out for."
There are two fueling occasions when gasoline vapors could escape into the atmosphere if they aren't recovered: When a retailer's storage tank is filled, and when a car's gas tank is filled at the pump.
With regard to the storage tanks, the Environmental Protection Agency (EPA) has mandated all petroleum retailers to install recovery systems that capture the vapors when their storage tanks are filled. These are called Stage I systems. Stations with a throughput of 100,000 gallons per month have until December 2010 to install these controls. Meanwhile, new regulations affect an estimated 14,000 additional sites nationwide.
Stage II systems, which cover automobile fill-ups, are more in contention however, and according to the Colorado/Wyoming Petroleum Marketers Association (CWPMA), Stage II systems would be wasteful, unnecessary and economically destructive if they were required in Colorado.
"There are several reasons Stage II systems are not practical here," said Mark Larson, executive director of the CWPMA. "One is that there is already an alternative system being installed by manufacturers on every new vehicle, called Onboard Refueling Vapor Recovery (ORVR). This captures the vapors on carbon canisters and burns them in the car engine. Compared to Stage II systems, ORVR systems are more cost efficient, require no yearly upkeep and keep emission efficiency more stable over time. Another reason we don't need Stage II systems is that they are an enormous waste of money, costing the average service station over $85,000 in equipment and lost revenue, an expense that could force many independent retailers out of business.
"And still another reason is that the national trend is to discard Stage II systems as an air control strategy," he continued. "Georgia, Florida, New Hampshire, Arizona and the Northeast States for Coordinated Air Use Management have all questioned the need for Stage II systems, or have already chosen not to adopt them."
The timeline to determine what action will be taken in Colorado runs from the end of this year, when an air control implementation plan must be submitted to the EPA. Then it must go through the governor's office, the state legislature and back to the EPA, after which Colorado will have a three year grace period to implement the control measures that have been decided upon. During that period Larson and the CWPMA will be working to oppose Stage II implementation.
Meanwhile, on another front, there's the matter of Colorado's 3.2 beer rule, which states that c-stores can sell only "weak" 3.2 beer, while liquor stores are permitted to sell "strong" 3.6 beer. And since liquor stores are closed on Sundays, c-stores sell 80 percent of their beer on that one day.
Now, however, there is a bill pending before the state legislature that would allow liquor stores to open on Sundays, and "that would be devastating to the state's 1,753 c-stores," said Larson. "It would reduce their annual beer sales an average of $27,000, since shoppers would flock to the stores that sell the stronger beer.
"This would be very unfair," he said. "Since c-stores would have no way to compete equally for the beer customers they already have. There is no license available to c-stores to sell alcoholic beverages other than 3.2 'Prohibition' beer. That means liquor stores will basically have a monopoly. Until a complete fiscal analysis is made of the impact of this legislation, we are opposed to it."
Although the bill has passed and is being considered by the governor, Larson and Grier Bailey, manager of government affairs for the CWPMA, are working to get the 3.2 and Sunday issues resolved before he signs it. The Sunday law is scheduled to take effect on July 1, 2008.
Ronna Alexander, state executive of the Montana Petroleum Marketers and Convenience Store Association, would like the world, and especially members of the Association, to know that the Association's annual conference will take place June 10-12 at the Holiday Inn Grand in Billings, Mont.
It includes a trade show, election speakers and employee retention workshops.
"How can anyone stay away?" she asked.
For more information, call Ronna at (406) 449-4133.