San Diego Ordinance Takes Aim at Gas Prices

Big oil companies are under attack in San Diego County, where motorists pay some of the highest prices for gasoline in the continental United States. The county wants to cut prices and spur competition by introducing an ordinance that would give service station managers more options when they buy gasoline for their pumps.

Under the ordinance, the state’s six biggest oil companies would be barred from setting prices at retail stations they own in the county. They are Atlantic Richfield Co., Chevron Corp., Exxon Corp., Mobil Corp., Shell Oil Co. and Texaco Inc.

Managers of company-owned stations would not be required to buy wholesale gasoline from oil company distribution centers, but could buy the same brand of gas from independent middlemen, whichever was cheaper.

“San Diego residents have been paying 20 to 30 cents more for gasoline than Los Angeles, and they’re sick of it,” said Mary Lasher, spokeswoman for county Supervisor Ron Roberts, who proposed the ordinance.

The ordinance, already passed by the Board of Supervisors, needs approval from cities representing two-thirds of the county’s population. Backers of the ordinance hope it passes countywide by the middle of the year.

The city of San Diego is considering putting the ordinance up for a vote by its City Council.

San Diego County consumes the third-highest volume of gasoline in Southern California, behind Los Angeles and its affluent suburbs.

Proponents say California’s gasoline supply is controlled by too few companies, especially in the San Diego area. They say this limits competition and allows big oil companies to charge more than they can in more open markets such as Los Angeles. But the oil industry says the ordinance would dampen competition and compromise the supply chain that runs from refinery to gas tank.

“We think it’s a free-market system that’s working well,” said Courtney Perry, spokeswoman for the Western States Petroleum Assn., an industry trade group.

About a quarter of San Diego County’s gas stations are owned by oil companies. Others are run by independent owners who can buy gasoline that is generic, or unbranded. A third category, which the ordinance hopes to bolster, is the independently owned station that is contracted to buy major brands of gasoline.