March 6, 2008

McCaskill Requests Hearing on Bill to Protect Consumers at the Gas Pump

WASHINGTON, D.C. – U.S. Senator Claire McCaskill this week pushed leaders of the Senate Commerce Committee to hold a hearing on a bill that would help protect consumers at the gas pump.

McCaskill, in a letter to Committee Chairman Daniel Inouye and Ranking Member Ted Stevens, requested that the Commerce Committee examine the FAIR (Future Accountability In Retail) Fuel Act, which would require the installation of automatic temperature compensating equipment in all retail gas station pumps to adjust the price of gas as it expands due to warmer temperatures. Reports indicate that Americans currently spend $2.57 billion more than they should for gasoline and diesel fuel due to gasoline expanding in warmer temperatures.

“Missourians are being cheated at the gas pump, and it’s time Congress put a stop to it,” McCaskill said. “With gas prices near $3 a gallon, every penny counts, and Americans shouldn’t be paying more to get less.”

McCaskill’s legislation was inspired by the Kansas City Star’s three-part series on “hot fuel” last year, which uncovered that the simple laws of physics were scamming consumers at the pump. Retailers currently measure gas at 60 degrees Fahrenheit, and consumers are paying a price for gas based on that temperature. However, warmer temperatures cause gas to expand and, as a result, consumers are getting less gas in the summer and in warm climates. As a candidate for the U.S. Senate, McCaskill pledged to work toward a solution to the “hot fuel” problem.

In addition to requiring all retail gas stations to install the new temperature compensating technology within 6 years, the F.A.I.R. Fuel Act would offer assistance for retailers to comply, and impose penalties for those who fail to ensure consumers are receiving the gas that they pay for.

The F.A.I.R. Fuel Act would:

Require installation of automatic temperature compensating equipment in all retail gasoline pumps within 6 years of the enactment the legislation.
Give the Federal Trade Commission, working in conjunction with National Institute for Standards and Technology, authority to implement the requirement with a final rule to be promulgated no later than 1 year after the enactment of the legislation.
Require state inspectors to determine if the equipment has been installed and report to the Federal Trade Commission during their annual inspections.
Give a reprieve with a follow-up inspection 180 days after the violation is found to first time offenders. If on the second inspection, retailers are still found to be in violation, they will be fined $5000 for each pump out of compliance.
Establish a grant fund for retailers, other than major integrated oil companies, who want assistance to pay for the new equipment. A retailer can receive $1000 per pump, but no more than $10,000 per retailer.

The F.A.I.R. Fuel Act has received praise as common-sense consumer protection legislation. Groups such as Public Citizen, Owner-Operator Independent Drives Association, Consumers Union, foundation for Taxpayer and Consumer Rights, Consumer Federation of America and U.S. Public Interest Research Groups (USPIRG) have endorsed the legislation.