August 20, 2001

CALIFORNIA SUES, NEW ENGLAND URGES REPEAL OF OXY RULES

The state of California has sued EPA in the Ninth District U.S. Court of Appeals over the oxygenate mandate in Reformulated Gasoline (RFG). The lawsuit, Davis v. EPA, was filed on Aug. 10 and charges that EPA acted in an "arbitrary and capricious" manner in denying California’s request for a waiver from that mandate. At least two major environmental groups are supporting California in this lawsuit – the Natural Resources Defense Council and the Clean Air Trust. Because California has banned MTBE effective 1/1/03, the major beneficiary of the continued oxygenate mandate would be ethanol. The Renewable Fuels Association (RFA), representing ethanol interests, was quick to denounce California’s laws uit as "an exercise in futility." They point out that California lost in its request for a waiver from the Clinton Administration, the Bush Administration, and Congress. Of course, only the U.S. House has voted against the "California waiver"; the Senate has yet to act. Meanwhile, the New England Governors Conference has issued a call for an aggressive effort to repeal the oxygenate mandate nationwide. Their strategy: to push for outright repeal of the mandate in Congress, and to ask EPA to grant state-by-state waivers from the mandate as an interim measure. NESCAUM, a northeastern states clean air coalition, has argued that there will be harm to the environment if the oxygenate mandate is continued. Interestingly, we have learned that EPA had sent a letter to Rep. Tauzin (R-LA) before the vote in the House on the California waiver. In that letter, EPA said it "strongly opposed" the Cox amendment, in part claiming they wanted to avoid further boutique fuels. New England governors appeared to be responding to that concern, promising to work in tandem on oxygenate waivers.

ANTITRUST ISSUES

In case you missed it, Texaco last week worked out a preliminary agreement with the Federal Trade Commission  (FTC) that will allow Texaco to be acquired by Chevron. The  agreement calls for Texaco to sell its interests in Motiva and Equilon (or place them into a liquidation trust), and also to divest some other holdings, including a part of its general aviation fuel marketing operations. 

Separately, Unocal Corp. has disclosed that it is under investigation by the FTC for possible unfair competitive practices during the regulatory process that led to the adoption of both California and federal RFG standards.

LETTERS STILL NEEDED

Have you written to your Congressmen yet about H.R. 2726,  the "Tribal-State Tax Fairness Act of 2001"? This legislation would help to resolve the growing problem of  some tribes and tribal members failing to remit the sales and excise taxes which the U.S. Supreme Court has ruled they rightfully should be collecting. A sample letter to your Congressmen and other information is available on the SIGMA website at www.sigma.org. Please contact all Congressmen in whose Districts you operate. We need to demonstrate support for this legislation if it is to be given consideration by Congress.

STARBUCKS ANYONE?

SIGMA is trying to get participation from Starbucks in our convention in Seattle, but we’re being told that they think there is no "future" for them in c-stores.

Help us by answering these 3 questions: 1) Are you currently doing business with Starbucks? 2) Do you WANT to do business with Starbucks? 3) What are your annual coffee sales?