Hawaii pondering changes gas price cap

HONOLULU -- In Hawaii, where motorists have long complained about the high cost of gasoline, the nation's first cap on pump prices is just a few months away.

Or maybe not: State lawmakers may delay the July 1 effective date by making changes to the law they approved in 2002. Some legislators say they want to address concerns about the law, which critics say actually could have driven prices higher had it been in effect last year.

It's uncertain how long revisions could delay a cap; one proposal would put it off for at least a year. But to many frustrated consumers, some kind of control is long overdue.

"Whatever they feel they've got to take us for, they do," said Hans Hussey, 34. "We've got to pay it. It's not like we can go to the next state."

On Sunday, AAA reported the average price for a gallon of regular unleaded gas in Honolulu was $2.04. On the Big Island it was $2.12 per gallon and on Maui $2.37. The national average reached a record $1.80 a gallon Friday, according to the Lundberg Survey of 8,000 gas stations.

The law, as it stands now, will mandate a maximum pretax price for gasoline sold at wholesale and retail levels. The cap is tied to a weekly average of prices in Los Angeles, San Francisco and the Pacific Northwest.

Supporters of the law argue the oil companies have kept prices artificially high for years. They cite a state attorney general's office report from the late 1990s that showed Chevron Corp. made about 23 percent of its profits in Hawaii, which accounts for only 3 percent of its market.

The company, now ChevronTexaco Corp., says that in the last five years its Hawaii business provided no more than 5 percent of its profits.

ChevronTexaco and Tesoro Petroleum Corp., which operate the only two oil refineries in the state, oppose the price cap, as do service station owners who say it could force them out of business.

Opponents of the cap say Hawaii's isolation, high taxes and other barriers to competition are what's driving up the cost of gasoline, not industry greed. The Legislature's Republicans minority tried unsuccessfully last week to repeal the cap altogether.

Lawmakers who supported the original legislation said they remain committed to the law and simply want to rework it to address concerns raised since it was passed.

"We're going to figure it out by the end of session" in May, said Democratic Rep. Ken Hiraki.

Some legislators want to re-examine the formula for setting the cap, and possibly tie it to gas prices nationwide. The current formula embarrassed supporters last year when West Coast prices rose above the Hawaii price.

Republican Gov. Linda Lingle opposes the price cap but has not said whether she would block regulations. The law allows her to suspend the cap if it is shown to cause hardship.

Filling up his sport utility vehicle recently, chiropractor Michael Joseph said he thinks price limits need to come soon.

"If you don't cap gas prices, they're just going to keep squeezing us," said Joseph, 56.