198           
HOUSE OF REPRESENTATIVES             H.C.R. NO.            
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                                
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                     HOUSE CONCURRENT
                        RESOLUTION

REQUESTING THE PUBLIC UTILITIES COMMISSION TO SUBMIT A PROPOSAL
   FOR BENCHMARKING WHOLESALE GASOLINE PRICES IN HAWAII.



 1       WHEREAS, the price of gasoline affects every consumer in
 2   Hawaii, either directly or indirectly; and
 3   
 4       WHEREAS, Hawaii has some of the highest gasoline prices in
 5   the United States; and
 6   
 7       WHEREAS, while the price of Alaska North Slope and Minas
 8   (Indonesian) petroleum, the two crude oils commonly used by
 9   Chevron and Tesoro, has dropped about 47 percent since December
10   1996, the price for unleaded gasoline in Hawaii has remained
11   consistently higher than the price at Chevron and Tesoro gas
12   stations on the mainland; and
13   
14       WHEREAS, the oil and gas companies doing business in Hawaii
15   have never been forthcoming with information regarding
16   profitablity or costs; and
17   
18       WHEREAS, the Department of the Attorney General has filed a
19   lawsuit against the oil and gas industry in Hawaii alleging
20   price conspiracy; and
21   
22       WHEREAS, ARCO, a recent new entrant in the Hawaii oil and
23   gas market, has been able to supply gasoline at a consistently
24   lower cost than both Chevron and Tesoro, even though ARCO
25   receives its supply of gasoline from the Chevron refinery; and
26   
27       WHEREAS, until ARCO arrived, local gas and oil companies
28   continued to charge a large margin above comparable mainland
29   markets; and
30   
31       WHEREAS, after ARCO arrived, it quickly became apparent
32   that there is wide flexibility in the pricing of gasoline; and
33   
34       WHEREAS, the State, counties, and military are experiencing
35   significant savings by signing contracts that are tied to
36   mainland "benchmarks"; now, therefore,

 
Page 2                                   198               
                                  H.C.R. NO.            
                                                        
                                                        

 
 1       BE IT RESOLVED by the House of Representatives of the
 2   Twentieth Legislature of the State of Hawaii, Regular Session
 3   of 1999, the Senate concurring, that the Public Utilities
 4   Commission (PUC) is requested to submit a proposal for
 5   benchmarking wholesale gasoline prices in Hawaii; and
 6   
 7       BE IT FURTHER RESOLVED that the PUC consider in its
 8   proposal: 
 9   
10       (1)  The cost of implementing a benchmarking program;
11   
12       (2)  The potential savings of a benchmarking program;
13   
14       (3)  The labor requirements of a benchmarking program; and
15   
16       (4)  The potential administrative placement of a
17            benchmarking program;
18   
19   and
20   
21       BE IT FURTHER RESOLVED that the PUC is requested to report
22   its findings and recommendations to the Legislature no later
23   than November 1, 1999; and
24   
25       BE IT FURTHER RESOLVED that certified copies of this
26   Concurrent Resolution be transmitted to the Chair of the PUC
27   and the Attorney General.
28 
29 
30 
31                         OFFERED BY:  ____________________________