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Cindy Crum of Lake Anna fills up her SUV at the Shell/Dairy Queen station in Thornburg. This Thornburg Shell station is charging $2.59 a gallon. The Valero station nearby is 6 cents cheaper. |
Spotsylvania County Supervisor Hap Connors threatened yesterday to file price-gouging complaints because of a lobbying association's campaign that blames a Virginia Railway Express tax for increased gas prices.
The county became a member of the commuter rail service Monday and enacted a 2.1 percent tax on wholesale gasoline required for VRE membership. The tax is expected to generate more than $3 million annually.
Supervisors expect to use more than 60 percent of the revenue for local transportation projects.
The Virginia Petroleum, Convenience and Grocery Association represents 650 retail members operating more than 4,500 convenience and grocery stores with gas pumps across Virginia.
Association spokesman Michael O'Connor said the group made laminated signs for Spotsylvania members that warn county residents they will pay 5 cents more a gallon because of the tax.
"Either the gasoline retailer will have to eat that 5 cents or it is going to be passed on to the consumer," O'Connor said.
Supervisor Connors sent O'Connor an e-mail yesterday warning that he would file price-gouging complaints if O'Connor did not remove the signs. The supervisor said a study sponsored by the Fredericksburg Realtors Association last year showed that, on average, gas prices weren't any higher in Fredericksburg or Stafford County than prices in Spotsylvania before it joined VRE.
In fact, prices in VRE localities were sometimes less, the study showed.
"This kind of scare tactic is misleading and unhelpful for the residents of this area and will be very damaging to any future relationships we may enjoy with your organization," Connors wrote to O'Connor.
O'Connor replied with a quote from German philosopher Arthur Schopenhauer: "All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident."
VRE spokesman Mark Roeber called the lobbying group's effort a stunt.
Jeff Miller, who owns the Shell station with a Dairy Queen off Interstate 95 in Thornburg said the VRE gasoline tax is "the craziest darn tax I have ever heard because they tax the tax."
The tax is assessed on wholesale gasoline he buys, which already includes federal and state taxes, plus the freight costs to deliver the gas to the station.
Miller said stations nationwide average 12-15 cents profit per gallon. The price of crude oil and a particular state's gas taxes are among the major elements that affect the price. Supply and demand and competition are also major factors.
Miller said the trend is to rely more on soda and snack sales for profit, but not every store can succeed this way.
"If somebody can be making it on a nickel a gallon less, they would already be doing it so they could steal business from the rest of us," he said. "There isn't a nickel of fluff in there."
Gas at his station was $2.59 a gallon for regular unleaded yesterday. Prices at nearby stations were less: Valero charged $2.53, the Exxon was $2.55 and the Citgo was $2.58.
"In the long run, if it is bad for business, ultimately it will be be bad for the consumer because it results in higher prices or less choices," Miller said.
Off I-95 in Fredericksburg, the BP station on State Route 3 was selling gas at $2.45 a gallon yesterday. Near I-95 in Stafford, prices ranged from $2.49 at a 7-Eleven on U.S. 17 to $2.61 at a BP on Courthouse Road.
O'Connor said the city BP station's price may be less because the freight cost could have been cheaper.
"Our point is that this was sold by Realtors as something for nothing," he said of VRE membership. "They didn't tell the truth."
Consumers didn't seem to care yesterday about the prices.
Scott Mull, of Shelby, N.C., said he didn't mind paying $2.59 at Miller's Shell station because gas in his state costs 10 cents more. North Carolina has a higher state gas tax.
What he did notice was the poor condition of the roads in Virginia. North Carolina uses the extra gas tax revenue for transportation, and some Virginia legislators use the neighboring state as an example when arguing for increasing Virginia's gas tax. North Carolina's state gas tax is 26.6 cents; Virginia's is 17.5 cents
"Our roads are much better than here," he said. "We don't have potholes like these. It's unheard of."
Cindy Crum, of Lake Anna, said she isn't going to go bankrupt over the pennies-per-gallon difference, but she wants to know the tax revenue is well spent.
"If it helps the county, I am OK with it," she said. "But I want to see it."
Dan Telvock: 540/374-5438
Email: dtelvock@freelancestar.com
