awaiting final approval on the floor of the California Senate is intended to
prevent price gouging by big oil companies – not just fuel stations.
General Bill Lockyer and Assembly Speaker Fabian Nunez offered the measure in
response to prices at the fuel pump that have jumped by more than $1 per gallon
since the first of this year.
effort – AB457 – advanced from the Senate Appropriations Committee this month.
If approved on the Senate floor, it would move back to the Assembly to sign off
on changes. If those requirements are met prior to the end of the regular
session Aug. 31, it would go to Gov. Arnold Schwarzenegger’s desk.
California law already authorizes the attorney
general to investigate allegations of price gouging at the retail level in the
state during emergencies declared by the governor or president. Retailers are
prohibited from boosting prices for goods and services, such as food, medicine
and fuel, more than 10 percent during a 30-day period after a declared
would give the attorney general 60 days after an emergency to initiate an
investigation into alleged price gouging. The entire fuel supply chain –
including oil companies, refineries and fuel distributors – would be reviewed.
suspect there’s price gouging by the oil companies going on, we need the tools
to investigate and determine if we’re being ripped off,” Nunez, D-Los Angeles,
said in a written statement.
could be declared when an “abnormal market disruption,” such as a cutoff of
shipments by an oil producer, increases wholesale and retail prices. The
governor now can act only during such circumstances like severe weather,
earthquakes and acts of war or terrorism.
state’s anti-gouging law currently does not allow law enforcement to hold
accountable oil companies that profiteer when consumers are most vulnerable,”
Lockyer said in a written statement. “This bill fixes that defect.”
also would allow the governor to declare an emergency, even if it happened
elsewhere – such as a hurricane on the Gulf Coast – disrupting production.
would face fines up to $10,000 and one year in jail.
California isn’t the only state this year to look
into adopting anti-gouging protections. The governors in Vermont and Wisconsin have approved protections while their counterparts in Colorado and South Carolina vetoed similar efforts.