There was plenty of support Tuesday at the legislature for a bill to prohibit advertising a lower price of motor fuel if it is not available at all the pumps at a station.The bill, LB 477, is aimed to stop the advertisement of a bargain price of fuel with the intent to encourage consumers to buy a more expensive motor fuel because the lower priced fuel is only available at a pump or two.
The bill’s sponsor is Sen. John McCollister of Omaha, who fell victim to the pricing scheme.
According to the language of the bill, a single price could not be advertised on a sign unless it is offered at all pumps, or, if there are two different prices, both prices must be advertised on the sign. Also, the same fuel would have to be offered at the same price if it comes from the same storage tanks.
The hearing was before the agriculture committee.
The bill was supported by the AAA Motor Club, the Better Business Bureau, and the Nebraska Petroleum Marketers and Convenience Store Association (NPCA). Supporters see the bill as an opportunity to stop a few bad actors who are hurting the reputation of Nebraska gas station operators.
“Unsuspecting Nebraskans and those traveling through our state are filling their tanks with gas that they think is offered for the price advertised on the sign,” McCollister said. “Unfortunately, by the time they figure out that they aren’t paying the price on the big sign, they’ve paid in some cases 50-60 cents more per gallon than the advertised price.”
“Our organization has been advocating for truth in advertising for over a century,” said President and CEO Jim Hegarty of the Better Business Bureau that serves Nebraska, Kansas, South Dakota, and southwest Iowa. “We are hopeful that such legislation will eliminate consumer complaints that the BBB is currently receiving related to this issue.”
Dan O'Neill, owner of the Kwik Stop station in North Platte, says it is not uncommon for customers who feel they have been deceived to come into his store to complain about his competitors.
“I run an honest business and it is a shame to see people disenchanted by a bad experience in one of our communities,” O’Neill said.
“The vast majority of petroleum marketers adhere to a standard industry practice of advertising and pricing,” said Tim Keigher, Executive Director of NPCA. “Some station owners have chosen to use a consumer’s expectations to trick them into paying more than expected -- a practice we think should stop.”
Two stations at North Platte's main I-80 interchange have used the practice. The stations typically offer a much lower price -- often the lowest price in town -- at two pumps. But both stations were sanctioned in 2007 by the Nebraska Attorney General under the state's Uniform Deceptive Trade Practices Act.
According to those settlements, the stations donated thousands of dollars to charity, and they changed their signs so the signs listed the pump numbers that have the low price.
Still, motorists are apt to pull in and presume the low price is available on all pumps, not noticing the difference until they look at their receipt after they fill up. A Colorado driver complained to the Bulletin about that in late November.
(The Unicameral Update is the news publication of the Nebraska Unicameral. The Bulletin staff contributed to this report.)