Anti-terrorism bill loses price-gouging penalty provisions

Thursday, May 16, 2002

JEFFERSON CITY, Mo. -- Ignoring the wishes of Gov. Bob Holden, legislators have dropped proposed penalties for businesses that engage in price gouging.

House and Senate members negotiating a massive anti-terrorism bill removed the price-gouging provision on an 8-1 vote Wednesday.

The Senate passed the full compromise bill on a 29-1 vote later Wednesday and sent the measure back to the House.

"It's the best we're going to do," said Sen. Marvin Singleton, the bill's sponsor.

The price-gouging provision previously had passed the House but had not been debated in the Senate. It was proposed as part of the state's response to the Sept. 11 attacks.

But the pricing provision was strongly opposed by the Missouri Petroleum Marketers and Convenience Store Association, which felt that the measure went too far.

Chief among the organization's concerns was that the bill could have allowed businesses to be charged with price gouging anytime, not just during disasters.

"If this is a problem, let's drop this out and try again next year," said Singleton, R-Seneca, the bill's sponsor.

Price gouging became an issue when an investigation by Attorney General Jay Nixon found that 48 Missouri service stations raised motor fuel prices above $2.49 a gallon following the terrorist attacks.

The gas stations were required to pay fines of $750 or three times their profits for Sept. 11 -- whichever was larger -- plus $250 in investigative costs. The state collected more than $49,700 in fines and another $10,250 in legal fees.

Under the bill passed by the House, a person found guilty of price gouging could have faced a fine up to $3,000 or twice the amount of money made illegally. It would be up to the attorney general to file charges.

Opponents to the House bill said there was no need to change state law.

"Right now the attorney general has sufficient authority and power to investigate and prosecute alleged price gougers," said Ronald J. Leone, executive vice president of the petroleum group.

Rep. James O'Toole, who cast the lone dissenting vote on the legislation, said he was concerned about the impact of the committee's decision on consumers.

"What we're saying to the public is that it's all right to price gouge," O'Toole said.

The governor's office and attorney general's office both were disappointed by the committee's decision.

"It's a victory for special interests and a loss for Missouri consumers," said Jerry Nachtigal, a spokesman for Holden, whose staff had lobbied to keep the price-gouging provisions in the bill.

The bill also creates the crime of water contamination and prohibits the transportation of hazardous waste through tunnels. Missouri's first road tunnel is to be built beneath a runway at Lambert Airport in St. Louis.

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