Have you ever wondered why gas stations often advertise two different prices on their sign? If you have not, then start looking and you will notice most stations advertise one price for cash (or company specific credit cards, such as Mobil, Shell, Chevron, etc.) and another for credit. The $0.10 difference, known as two-tiered pricing, is an attempt by station owners to recover steep credit card fees by incentivizing customers to use cash.
Over the past few years, many customers have expressed frustrations towards the station owners by being lured into a gas station for a lower price only to find a higher price at the pump when using their credit card. In response to public outcry, many counties enacted ordinances that require stations to list the highest price on their signs. For example, in Broward County, there is an ordinance on the books that requires gas stations to “disclose the highest price that the customer must pay for each grade of such gasoline or diesel fuel.” Recently, around mid-June 2014, Palm Beach County enacted a similar ordinance that required gas stations signs to clearly “indicate the maximum retail price per gallon.” As such, stations are not required to list the two prices. Rather as long as the highest price is listed then the gas station is in compliance.
It is commendable that the counties are attempting to keep the public informed as to the price of fuel. However, from the business owners’ perspective, the law change can result in signs that cost in the tens of thousands of dollars and/or citations from the cities and counties for failing to comply. Being that our firm represents businesses with tax and licensing issues against state and local governments and government agencies, I wondered whether the cities and counties had the authority to make such laws.
Without making this article to legalese in nature, it is at least arguable that the counties lack the power to enact such laws. At a very basic level, local governments have broad powers to make law in the interest of the public welfare within its locality. Therefore, unless some state or federal law exists that says a local government cannot make a particular law then a local government has the power to make that law.
As it turns out, Florida law creates broad powers to the Department of Agriculture (“DOA”). One such power of the DOA is to enforce state laws relating to the sale of liquid fuels. The state law goes on to say that such laws relating to the sale of fuel expressly preempts any local law relating to the same. Further, the DOA has exercised this power by allowing for different cash and credit pricing for fuel but has no requirement for a station listing the highest price for the fuel. Being that the sale of fuel is under the purview of the DOA then the county or city likely does not have the authority to make such laws.
If you or your client’s company has this issue with its city or county then there may be grounds to fight the county ordinance. Many local governments often overstep their bounds and make laws to which they do not have the power to create in the first place. While their goal is not a bad one, it is still our job to provide a check on the government by fighting them when they cross the line. There have been rumblings in the service station community that these ordinances may be ripe for fighting and I will keep you posted if and when the contest cases move forward.
If you or your client’s company is being treated unfairly by state or local government or a state agency then please do not hesitate to contact me for a free consultation.
Original Post By: Jerry Donnini