Minnesota enacts fuel price-gouging protections; New York does not

State lawmakers in Minnesota and New York took up pursuit this year of rule changes that show little tolerance for price gouging, or merchants who take advantage of special circumstances, such as a power outage or hurricane, to jack up the price of goods, including fuel.

The pursuit of price gouging protection in Minnesota was successful while the New York version fell short.

The National Conference of State Legislatures reports that 37 states have some type of price gouging ban. The laws in most of those states are triggered by emergency declarations.

Minnesota’s price gouging law

Minnesota Gov. Tim Walz has signed into law a bill that includes a provision to prohibit retailers of an “essential consumer good or service” from engaging in price gouging during an “abnormal market disruption.”

Situations covered in the new law, SF2744, include a natural or human-made disaster, a public health emergency, and a national or local emergency.

Essential commodities referenced in the protection include motor fuels, transportation, food and water.

Retailers are prohibited from charging “unconscionably excessive prices” for essential goods or services that exceed 30% within a seven-day period.

The Minnesota Attorney General’s Office would investigate alleged violations.

Violators would face fines up to $10,000 per sale or transaction.

The rule took effect immediately.

Protection needed

Rep. Zack Stephenson, D-Coon Rapids, said the change is necessary because Minnesota does not have any protection from price gouging.

He told a legislative committee that Minnesota residents would not have recourse for any instances of price gouging in the state like what occurred in Texas last winter during widespread blackouts.

“This bill would change that. It would make it illegal to price gouge during a disaster declared by the governor,” Stephenson said. “It also establishes clear expectations for what is permissible and impermissible pricing behavior during an emergency. Businesses deserve to know what they can and can’t do in those circumstances.”

New York

Concern about price gouging was also addressed in a failed New York Assembly bill.

State law prohibits price gouging of goods and services.

Sponsored by Assemblywoman Nily Rozic, D-Fresh Meadows, the bill was intended to clarify that “vital and necessary goods” include fuel, energy, and transportation goods and services.

Additionally, a provision would be added to statute to require the state’s attorney general to publicize regulations that would obligate “periodic price disclosure by all actors in the supply chain” for gas, diesel, crude oil, or otherwise, that are sold in or into the state.

“Requiring periodic disclosure of the prices charged at each stage of the supply chain for oil and gas in New York by every actor in that chain, rather than simply the spot prices charged at the pump or at the terminal, permits rapid detection of both unconscionably excessive prices and the actors behind those unconscionably excessive prices after abnormal disruptions of the market,” a bill memo reads.

A450 remained in the Assembly Consumer Affairs and Protection Committee when the regular session ended last month, effectively killing it for the year. LL

More Land Line coverage of news from Minnesota and New York is available.