Price-Gouging Complaints Proliferate

Surging gasoline prices from California to Maine sparked cries of price gouging Thursday, while refugees fleeing the hurricane-devastated Gulf Coast complained that businesses in nearby states were jacking up prices on a raft of items, including hotel rooms and bags of ice.

As $3-a-gallon gasoline spread nationwide, Gov. Arnold Schwarzenegger asked the California Energy Commission to see whether price gouging had occurred in the state.

Alabama launched a similar probe.

Georgia Gov. Sonny Perdue signed an executive order to punish gougers as Atlanta motorists waited in long lines to buy gasoline that hit $5 a gallon in some areas.

Congressional representatives also chimed in. Rep. Fred Upton (R-Mich.) griped of pump prices jumping 30 cents or more a gallon overnight. Rep. Edward J. Markey (D-Mass.) demanded a task force to probe “rampant gasoline price gouging.”

“I think it’s terrible,” said retiree Neil O’Brien, 74, as he pumped gas at a 76 station near his home in Silver Lake. “When you start filling the tank for $50, it makes you think if you can do without some things.”

Paul Sawan, the station’s owner, said he wasn’t seeing any of the added profit from rising gas prices because he was paying more for supplies. He raised his prices Thursday morning to $3.079 a gallon for self-serve regular, up 7 cents.

“I feel like I don’t want anybody to see me. I’m going to go hide in the back,” he said.

Oil company executives said that they did not tolerate gouging and that one factor in the price increase was motorists filling up before the Labor Day weekend.

Shell Oil Co. was encouraging wholesalers and dealers to “practice restraint during these periods,” spokeswoman Anne Peebles said in a statement, adding that Shell “does not condone price gouging and we will be investigating any allegations” of it.

The average price for self-serve regular in California was a record $2.884 a gallon Thursday, up 8.3 cents from Monday, according to AAA.

But prices varied widely. In the Greater Los Angeles area, they ranged from a low of $2.65 a gallon in North Hills to a high of $3.21 in Covina, according to GasBuddy.com, a website that tracks prices provided by volunteers.

While motorists throughout the country complained about gasoline prices, hurricane refugees who fled to neighboring states besieged authorities with complaints of exorbitant prices for hotel rooms, power generators, batteries, water bottles and ice in the wake of Hurricane Katrina.

“Just like a tragedy brings out the absolute best in most people, it also brings out the absolute worst in some people,” said Chris Bence, spokesman for Alabama Atty. Gen. Troy King.

Bence said that though 60% of the 424 complaints in Alabama had been aimed at gas costs, the rest centered on a variety of other products.

“What’s the big deal about a bag of ice?” he said. “It’s as important as all get-out to someone who’s trying to keep insulin cool and they don’t have electricity. It’s despicable.”

Legal definitions of price gouging vary from state to state, and such cases are often hard to prove, officials said Thursday. At the same time, some state officials near the hardest-hit regions said they had mounted aggressive efforts to warn businesses against unfair price increases, and they claimed some success in limiting the exploitation of consumers.

In Texas, for example, law enforcement officials assigned five teams of officers to warn innkeepers against gouging refugees.

“We wanted to put businesses on notice that we would pursue them if they exploited the situation,” said Tom Kelley, a spokesman for Texas Atty. Gen. Greg Abbott.

Abbott’s office is also investigating complaints in Houston and other areas that are drawing swarms of Louisiana refugees. Kelley said that some low-end motels allegedly doubled their rates in the storm’s aftermath and that one reportedly increased its overnight rate from about $50 to $300.

Another motel allegedly limited its rooms to two occupants, he said, forcing parents who wished to share a single room with their children to pay for an additional room.

The Texas attorney general’s office was also looking into a report “of a family getting awakened in the middle of the night and told that if they couldn’t come up with another $50 or $100, they’d be evicted,” Kelley said.

In Florida, Katrina-related complaints have centered on food, water and ice and mostly came from South Florida, early in the storm.

“We will be vigilant for reports of anyone going unconscionably beyond the normal economics of supply and demand, and we will fully investigate any such occurrences,” Atty. Gen. Charlie Crist said in a statement Thursday. “This applies to gasoline, or any other necessary commodity, while Florida is in the current declared state of emergency.”

Some who booked rooms in Tallahassee-area hotels have been granted only temporary stays, but this “doesn’t seem to be a price-gouging matter,” said Bob Sparks, a spokesman for Crist.

Sparks said the hotels were simply honoring prior reservations made by people coming to watch football games at Florida State and Florida A&M; universities.

“There doesn’t seem to be anything in the statute that regulates that, as far as we’re concerned,” he said.

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Rapid rise

Thursday’s average price and increase from Wednesday in selected cities for a gallon of self-serve regular gasoline:

*--* 1-day Thurs. change price (cents) St. Louis $2.549 +11.1 Atlanta 2.664 +8.9 Kansas City, Mo. 2.695 +8.8 Jackson, Miss. 2.806 +7.6 Denver 2.657 +6.3 Houston 2.631 +6.0 Chicago 2.865 +5.9 Miami, Fla. 2.747 +5.5 Birmingham, Ala. 2.574 +5.5 Memphis, Tenn. 2.656 +5.1 San Francisco 2.949 +4.8 Los Angeles- Long Beach 2.855 +3.2 Cleveland 2.645 +2.9 New York 2.776 +2.4 Honolulu 2.857 +1.7 Baton Rouge, La. 2.537 +1.1

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Source: AAA

Times staff writer Richard Simon in Washington and special correspondent Dana Calvo in Houston contributed to this report.