The Daily Gazette - Schenectady, NY
Daily Gazette

State will permit retailers to price gas by half-gallon
Thursday, May 29, 2008

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— State officials said Wednesday that gasoline retailers may now apply for permission to charge customers per half-gallon of gasoline to compensate for older pumps that only price up to $3.99.

The average price per gallon of regular gasoline in the Capital Region Wednesday was $4.07, according to albanygasprices.com.

The new pricing rule does not affect gas prices or digital gas dispensers, estimated at 95 percent of the market, but would allow the 5 percent of retailers still using mechanical readout devices with rotating wheels that don’t have numbers above $3.99 per gallon to instead show the price per half-gallon of gas under a sign stating “one-half total sale” and “one-half price per gallon.” State officials said signs on top of pumps and along roadsides must continue to show the full price per gallon.

“The price of fuel is rising faster than our dispensers can calculate in some instances,” state Agriculture and Markets Commissioner Patrick Hooker said. “In order to keep some of our smaller and seasonal fuel retailers operating during times of $4 fuel, we are temporarily allowing stations to compute prices by using half the price per gallon.”

It was Hooker’s decision to invoke the half-gallon price provision because the New York state Division of Weights and Measures is a division of the Department of Agriculture and Markets.

The rule allowing regulators to permit half-gallon sales under certain market conditions originated in the early 1980s when gasoline was $1.99 a gallon. State officials said the last time it was used was in 2005 when the price went above $2.99.

Jessica Chittenden, spokeswoman for the Department of Agriculture and Markets, said retailers affected by the rise above $3.99 have been asking the state to invoke the half-gallon rule. She said regulators were only able to do so after it was determined that there is a national shortage of computers capable of upgrading the old mechanical pumps.

“The way the regulation is written it requires us to respond to a certain situation so, if there was not a problem with getting the equipment or the parts for these mechanical dispensers, then there wouldn’t be a need for this kind of exemption,” Chittenden said.

According to state officials, the primary U.S. manufacturer of the equipment needed to upgrade the old pumps has a backlog of 13 weeks for delivery. Chittenden said another company in Connecticut that builds similar devices has a backlog of 17 weeks.

Kevin Gendron, the owner of Gendron’s Citgo Service Station in Troy, said his station had been using the older pumps without $4 price capability but last week he was able to get equipment to upgrade them, with help from his new gas supplier. He said he once sold gas at the half-gallon price and would never do so again.

“We did that when it went $3 and all you get is a rant. The people see what’s on the pump and [they think] that’s what they are paying. They don’t understand it whatsoever. You couldn’t stand here long enough to explain it to them,” Gendron said.

Gendron said his station will no longer be buying gas from Citgo because the gas supplier would not help his company with the costs of purchasing the equipment to upgrade the old pumps, which he estimated at approximately $2,000. He said he will now be purchasing gasoline from Troy-based John Ray & Sons Inc.

“Once these retailers have the updated equipment, it is generally a quick fix,” state Division of Weights and Measures Director Ross Andersen said. “The older equipment meets the same accuracy requirements as the newer electronic equipment, it just lacks the bells and whistles, like the pay-at-the-pump feature.”

The Division of Weights and Measures is now accepting applications for eligible retail stations to sell half-price fuel. Applications are available on the department’s Web site at www.agmkt.state.ny.us and by clicking on “Fuel Pump Half-Pricing Request Form” or by calling 457-3146. Chittenden said the department will try to expedite the applications.



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