Assemblyman Lavine: Legislation Will Stop Predatory Gas Pricing Which Robs Consumers at the Pumps

Assembly also passes bill allowing victims of price gouging to sue violators
March 13, 2012

With the cost of oil on the rise, serious competition between gas distributors has caused many stations to charge outrageous amounts for a gallon of gasoline. In fact, some gas merchants have been known to continuously raise their prices over the course of a 24-hour period, often dramatically increasing consumer costs without the actual price of gas going up. This predatory practice, known as price gouging, allows a deceitful gas distributor to make unreasonable profits at a time when many families are struggling to make ends meet.

As gas prices constantly fluctuate, we must make sure local families donít fall victim to price gouging at the pumps. Thatís why the Assembly passed legislation I helped pass that would ban gas stations from adjusting their prices multiple times daily (A.1970). Distributors usually purchase their gas wholesale and at a fixed rate, allowing many stations to unfairly take advantage of consumers at a time when gas prices are at the highest levels in months.

Our state is already home to some of the highest gas prices in the country. Currently, the average price of gas in New York sits at $3.98 a gallon Ė 22 cents higher than the national average. In many places around the state, gas prices have been known to exceed $4 a gallon. With the increasing cost of living and transportation, and a weak economy, itís imperative that we prevent drivers from being forced to pay unfair prices for gas.

Recently, several gas stations in New York were fined by state Attorney General Eric Schneiderman for unscrupulously increasing costs on consumers after Tropical Storm Irene. One station was selling regular, unleaded gas for $4.05 a gallon before the tropical storm. But just two days later, the cost of gas at that station jumped to $4.89 a gallon. In another case, the cost of unleaded gas jumped almost a dollar after two days.i Itís completely unacceptable for stations to use any kind of natural disaster or fluctuations in the price of gas to make an unreasonable profit, especially at a time when many families canít afford it.

In an effort to strengthen protections for victims of price gouging, the Assembly also passed legislation I supported that would allow victims to directly sue price gougers (A.8340). Currently, only the state attorney general has the power to fine or prosecute violators. This measure would give consumers the right to seek justice and compensation from dishonest merchants.

Itís disgraceful that gas distributors would dramatically increase prices on consumers just to pad their profits. By banning price gouging, we will be able to ensure consistency and fairness at gas stations around the state. I urge the Senate to pass both pieces of our legislation and help ensure that local families arenít exploited by unscrupulous gas distributors.