State lawmakers in Missouri are kicking around a proposal that requires convenience stores and gas stations to tell customers before the enact fuel price changes.
This proposal is from a republican state rep from southwest Missouri, Ray Weter, according to St. Louis (Mo.) Today. The proposal would require fuel distributors to tell the stations in advance and the gas stations would be required to post a sign 24 hours ahead of the increase.
The Missouri legislation is one of several creative, angst-inspired proposals being floated in state capitols as lawmakers look for ways to provide election-year relief from gasoline prices that are nearing a national average of almost $4 a gallon. One South Carolina lawmaker is proposing to cap gasoline prices, while officials in some other states want to cut gas taxes.
Missouri’s proposal, which received a hearing Tuesday in a House committee, wouldn’t prevent prices from going up but would at least help families plan when to purchase, said sponsoring Rep. Ray Weter.
But many critics and economists say there’s actual very little, if anything, lawmakers can do to put a real dent in gas prices.
Joseph Truek, the dean of the School of Business and Economics at Lynchburg (Va.) College, said consumers might be looking to their elected officials to take action on gas prices, but even state lawmakers can’t fully control the market movements or find enough room in cash-strapped budgets to cut gas taxes.
“Gasoline prices, in a very visible and immediate way, impact the consumer,” he said. “It hits them right in the pocketbook. Ultimately, there’s very little they (lawmakers) can do.”
That’s not stopping many officials from trying, the report said. Connecticut Gov. Dannel Malloy signed a measure this week that caps the state’s tax on the wholesale price of gasoline, a move that’s projected to save consumers 1 or 2 cents on each gallon they buy.
Eugene Guilford, president of the Independent Connecticut Petroleum Association, said the average wholesale price of regular unleaded gasoline in the state jumped 6.6 cents per gallon from Monday to Tuesday. That would erase the expected 1.7 cents-per-gallon benefit from capping the gross receipts tax when wholesale prices hit $3 a gallon.
In South Carolina, Democrat Sen. Dick Elliott, of North Myrtle Beach, has filed legislation that would cap prices at the level they were at June 1, 2011, until June 2012. The average retail price of gasoline in South Carolina was about $3.48 per gallon in June 2011. As of Tuesday, it was about $3.66 per gallon.
John Felmy, chief economist for the industry group American Petroleum Institute, told the Associated Press that posting advance notice of price increases would motivate most people to purchase their gas the day before. And if lawmakers capped the price of gasoline somewhere, oil companies might decide to simply sell elsewhere where market prices are higher.
“Price controls don’t work,” he said. “Whether it’s wholesale or retail, if the market’s not allowed to work, what you’re going to do is cause panic.”
Hawaii did enact caps on the wholesale price of gas in 2005. But the caps were repealed the next year after the state found that island drivers were actually paying more than that they would have, because gas stations were charging the maximum amount allowed under the caps instead of the market price of the gas.