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Discounted gas ruling may alter legislative debate


© St. Petersburg Times, published April 6, 2000

TALLAHASSEE -- Florida motorists took another hit at the pump this week.

A South Florida judge has ruled that it is against state law to sell discounted gasoline or offer credit card rebates on gas purchases. The judge ordered Murphy Oil Co. and Wal-Mart to stop giving discounts to gas customers.

The court decision comes amid a heated legislative debate over the 1985 law that forbids the sale of gasoline below cost.

The decision, issued Tuesday by Circuit Court Judge Burton C. Conner in Okeechobee County, is likely to change a proposal dear to the heart of the Petroleum Marketers and Convenience Store Association.

The ruling clearly increases the pressure on lawmakers to do something that would help constituents avoid the increasingly high cost of filling their tanks. Much of the high cost of gas these days stems from high prices set by Arab oil producing nations. But the petroleum association that represents most of the state's gas stations wants legislators to pass a bill that would strengthen a 1985 law that makes it illegal to sell below-cost gasoline.

The original law was designed to prohibit the kind of predatory pricing that could drive out competition.

Wal-Mart and Murphy Oil have been fighting this year's bill because they want to continue offering gift cards that give a discount to Wal-Mart customers.

Last month, lawmakers agreed to eliminate language sought by the petroleum companies that would clearly make all discount sales illegal. That left the bill silent on the question of discounts.

The court ruling finds Murphy Oil guilty of violating the 1985 law and orders the company to stop selling below-cost gas at its station in Okeechobee County.

After the court decision, legislators are taking another look at the bill with an eye toward making it legal to use discount and rebate cards.

Rep. Mark Ogles, R-Bradenton, chairman of a key House committee that has approved the bill sought by petroleum companies, said Wednesday that he thinks the final bill will allow Wal-Mart and other companies to offer discounts.

"The end result will be lowering the price for consumers," Ogles said.

Lobbyists for Murphy and Wal-Mart say the court ruling underscores the need to repeal the 1985 law in its entirety.

Ogles said he doesn't think the law will be repealed because legislators want to be sure that refinery-owned service stations cannot drive competitors out of business and jack up the price of gas in small towns.

Mike Huey, lobbyist and lawyer for the petroleum companies, said he hopes legislators will go ahead and pass the bill without amendments.

Charles Ganus, senior vice president for marketing at Murphy, said Murphy will probably appeal the court decision but will also work with consumer groups to get the entire law repealed.

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