Gas prices get lawmaker’s scrutiny
The Aspen Times
Aspen, CO Colorado
A state lawmaker is asking the Colorado attorney general to investigate gasoline prices in seven Colorado counties, including Pitkin, Garfield and Eagle.
Rep. Al White, who represents part of Garfield County as well as several surrounding counties, asked for an investigation of pricing “irregularities.” White does not represent Pitkin County.
“I’m not trying to indict the retail gasoline suppliers or the distributors. I just want a closer look at what is driving prices in northwest Colorado,” said the Republican, who is running for a Senate seat in District 8 in November, on Wednesday.
Gas prices in Glenwood Springs have been between 6 and 12 percent higher than prices in Denver for the past three years, according to data from the American Automobile Association. On Wednesday, prices in Aspen ranged between $4.80 and $4.88 for a gallon of regular unleaded, compared to a national average of $3.62.
White said he has been aware of the pricing disparity in northwest Colorado, but attributed it to “variables in the retail market,” such as higher land and employee costs.
A Carbondale constituent, however, recently told him about a lawsuit filed 30 years ago against local gas distributors. The distributors were indicted on charges of collusion, and fines were levied against them, according to White.
“If we don’t pay attention to our history, we’re doomed to suffer the same mistake,” he said.
Nate Strausch, spokesman for the Colorado office of the Attorney General, could not confirm the existence of the 30-year-old-case but said it is certainly possible that such a case exists.
White said he also learned recently that only a few distributors deliver to northwest Colorado ” although local gas stations and distributors estimate that the number is around six.
“That led me to start thinking it at least deserves some formal action,” he said.
Strausch said that the office will keep its eye out for any evidence of price collusion.
But to launch a full investigation, the attorney general would need concrete evidence that gas stations or distributors are communicating with each other to raise prices.
Because Colorado does not have a price-gouging statute, the office cannot merely investigate because prices are high, Strausch said. Eight states do have price-gouging statutes, according to the National Conference of State Legislators.
Paul Brown, general manager of Monumental Oil in Grand Junction, which distributes to the area, said it does not collude with other distributors, but declined to explain how the company sets its gas prices.
“That’s proprietary,” he said.
He noted that gas prices are a matter of supply and demand. “It’s what the market will bear,” he explained.
Bill Brandsma, petroleum manager at the Roaring Fork Co-op in Carbondale, agreed.
“It’s what the economy will bear,” he said. “We don’t seem to live like the rest of Colorado does, either.”
Brandsma and Jeff Jandegian, owner of Snowmass Village Conoco, also pointed out that the cost of transporting gasoline from the nearest refineries ” in Grand Junction or Denver ” also raises prices. Jandegian said he pays $1,000 whenever a tanker makes a delivery, usually about once a week. Brandsma estimated that the cost of bringing gasoline in to Carbondale adds 16 or 17 cents to the price of gas.
Brown said an investigation is not warranted.
“I feel bad for people trying to make a living in your area,” he said. “I feel for people who have to spend a large percentage of their income on anything. But politicians need to stay out of the market.”
Brown suggested that if the gasoline industry was really as lucrative as people suspected it was, there would be more players in it. He pointed out that the expenses of doing business in Aspen are high, and those expenses have to be passed on to the consumer.
“My guess is that at some point you won’t have any gas stations up there, because land is too valuable,” he said. “And that’s not good for anybody.”
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