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Fractional gas prices at issue

12:35 AM EDT on Thursday, April 24, 2008

By Cynthia Needham

Journal State House Bureau

PROVIDENCE — The soaring price of gasoline made its way to the General Assembly yesterday with House lawmakers narrowly approving a bill they say will erase at least one headache at the pump.

The legislation would eliminate fractional pricing at gas stations, requiring owners to charge only whole-cent prices when selling retail fuel.

Supporters say the change would create more straightforward prices, so the consumer knows exactly what he or she is paying for gas –– as agonizing as that can be in times like these.

But critics on both sides of the aisle yesterday sharply disapproved of the bill, saying the Assembly has no business sticking its nose into the matter of gas pricing. State law does not explicitly prohibit gas stations from using full-cent figures, meaning business owners can do so if they choose.

“It’s a waste of time. Leave the gas stations alone. They’ve been doing this for 100 years,” said Rep. Richard W. Singleton, I-Cumberland.

Others complained that the bill is a disadvantage for station owners in communities near the borders of Massachusetts and Connecticut where owners can charge what they like. And they say it assumes drivers were too stupid to understand the decades-old pricing schedules.

The use of fractional gas pricing around the country dates back to the Great Depression of the 1930s when gas stations were fighting for business and doing their best to undercut each other’s prices.

With today’s prices approaching $3.50 a gallon in Rhode Island, some legislators, including sponsor Amy G. Rice, D-Portsmouth, call the practice a tradition of a bygone era.

“At this point it’s deceptive, a lot of places don’t even put the 9/10ths,” Rice said. Gas stations get the benefit of telling their customers that the gas is still $3.49 a gallon when it reality it’s much closer to the dreaded $3.50 mark. Changing that custom isn’t regulating prices, it’s being more honest, she said.

On a legislative day when the House was expected to pass more than 40 bills, lawmakers spent close to an hour “debating pennies” as Minority Whip Nicholas Gorham, R-Coventry, put it. They used up so much time in fact that they had to push off half the proposals on the agenda until today because of time constraints.

The bill ultimately passed, 36-30, though legislators rejected an amendment that would have required stations to keep their prices consistent for at least 24 hours at a time. The gas legislation will be sent to the Senate this week.

cneedham@projo.com

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