|
|
 |
|
 |
|
November 15, 2004
CONVENTION HIGHLIGHTS INCLUDE ELECTION, SPEAKERS, AWARD
SIGMA’s 46th Annual Meeting has just concluded in New Orleans, with the reins of leadership passing to new President Bill Shipley, Shipley Energy, York, PA. Other new officers elected and installed in office include First Vice President Paul Reid, Reid Petroleum, Lockport, NY; Second Vice President Carl Boyett, Boyett Petroleum, Modesto, CA; and Secretary/Treasurer Jack Pester, Pester Marketing, Houston, TX. Mike Ports will continue on the Executive Committee as Immediate Past President.
New Directors include Grady Chronister, Chronister Oil Co., Springfield, IL; David Collins, Wilson Fuel Co., Halifax, Nova Scotia, Tom Dwelle, Nella Oil Co., Auburn, CA; and Tom Schmidt, U.S. Oil Co., Combined Locks, WI. All will serve 3-year terms, joining 8 other continuing Directors.
In addition to recognizing retiring Board members, SIGMA bestowed its highest honor the Distinguished Marketer Award on long-time marketer, advisor, and consultant Harold Grueskin of Denver, CO.
As is always the case with a SIGMA convention, it’s hard to pinpoint just one single “highlight” of the weekend, there were so many. We’ve already had lots of requests for copies of speaker slides from the 57+ hours of educational workshops, seminars, and general sessions (those will be posted here on the SIGMA website over the course of the next week or so as finalized versions become available). Social events and tours were well-attended and well-received, and food/service at the Ritz Carlton were great. (It’s hard to get a bad meal in New Orleans!) The two pre-convention intense educational programs -- EMI/SIGMA Masters Effective Fuel Buying and SIGMA/NPN/OPIS Site School -- attracted 25 and 40 students respectively. Even as you read this, the post-convention events continue, with the EPA/API/SIGMA (and others) Ultra-Low-Sulfur Diesel Implementation Workshop.
If you were one of the 571 marketers, suppliers, and guests in attendance, we ask you to be sure to complete the convention evaluation form so we can measure more objectively your reactions to the events and use those evaluations to guide our planning for future meetings. If you were not in attendance . . . well, it’s time to get future SIGMA meetings on your calendar so you don’t miss them!
MTBE LIABILITY
A panel of attorneys addressed the Legislative Committee on the question of MTBE liability and related issues. A large number of class-action lawsuits are out there, many with novel claims and novel theories of liability for marketers and/or manufacturers of MTBE. In essence, it appears that plaintiffs attorneys are seeking to turn MTBE into the next "asbestos" litigation. While much more information was imparted in the workshop, the bottom line is this: if you are named in an MTBE liability lawsuit, be aware that there are tremendous resources available to help you defend yourself; you don’t have to re-invent the wheel, you are not alone, and there is a significant infrastructure already in place. You might want to save the following e-mail addresses for two of the key attorneys in existing litigation for future use, if needed. Peter Sacripanti is at psacripanti@mwe.com and Mark Tully is at mtully@goodwinproctor.com. Of course, you can also contact SIGMA’s attorneys as well, and they will have the contact information for these attorneys.
CONGRESS BACK TOMORROW
Congress returns to Washington tomorrow for its lame-duck session. Government funding is the only issue sure to be handled, at least in some fashion. There are two possibilities : either a long-term Continuing Resolution to punt the issues to the new Congress which takes office in January (the current CR authority expires Nov. 20), or some sort of huge omnibus spending bill, which might then include lots of other issues as “riders”. There is also a good possibility Congress will act on an Intelligence Bill, enacting the reforms urged by the 9/11 Commission. (Marketers have significant interest in at least one provision of that bill -- a requirement for more standardized and machine-readable drivers licenses and other state-issued I.D. The House version has more specific detail than the Senate version does.) There is only an outside possibility that the long-staled Energy Bill might come back to life, and virtually no possibility that a Highway Bill will be taken up. At least that’s what the experts say.
ULTIMATE VENDOR RULE
As we have previously reported, one of the significant buried provisions in the business tax bill passed just before the election was a change in the way excise tax refunds for sales of gasoline to tax-exempt entities are handled. Effective Jan. 1, 2005, those refunds will be handled the same way as was already applicable to diesel sales to such entities. Because this is a change in law, not just a regulation, marketers, credit card issuers, and others involved in such transactions have only 45 days to be sure their current systems are in compliance with the new provisions; or to change the way they do business in such cases.
In essence, there are only two ways to handle refunds of taxes for such sales. Either the purchaser (i.e., a city government, etc.) can pay the tax and apply for a refund, or the seller (the “ultimate vendor”) may sell tax-paid fuel tax-excluded and claim the refund on behalf of the tax-exempt purchaser. There are 4 tests that must be met to qualify as an “ultimate vendor” to make refund applications, and the seller must pass all 4 tests:
1) You must have bought fuel tax-paid and sold it ex-tax.
2) You must certify the tax exempt status of the purchasers.
3) You must be registered with IRS.
4) You must be, in fact, the ultimate vendor -- i.e., the party which had title to the fuel at the time and which transferred title to the tax-exempt organization.
That final point -- being in fact the ultimate vendor -- is the one which is raising the most questions, specifically related to sales made with the use of oil company credit cards, multi-company fleet cards, etc. Although earlier versions of the bill contained a provision defining the "extender of credit" as qualifying for “ultimate vendor” status, the bill as signed into law does not contain that provision. Extenders of credit are not precluded from being “ultimate vendors” -- they simply have to meet all of the above tests the same as anyone else.
This issue was discussed at length in the Legislative Committee meeting. There were lots of questions regarding the applicability of the law to specific sets of circumstances. Some companies may have to scramble on #3 or #4 over the next 45 days. Members with questions about how the law might affect them should call SIGMA attorneys Greg Scott (202-342-8646) or Tim Columbus (202-342-8555). We now have posted on our website a detailed legal memo on the new tax law which includes references to this provision.
Discussion at the Legislative Committee also addressed the question of SIGMA’s position on the changed rules. We have had a position, going back 6 or 7 years, in support of this change as a way of stopping some “leakage” of tax money from the system. An opportunity was given to propose a change in SIGMA’s position, but no one did so.
BOUTIQUE FUELS
On Nov. 9 (last Tuesday), Bob Dineen, President & CEO of the Renewable Fuels Assn. (RFA) sent a letter to Rep. Blunt (R-MO) formally endorsing H.R. 5165, the Boutique Fuels Reduction Act of 2004. RFA is the national trade association for the ethanol industry. SIGMA has been working to line up additional support for H.R. 5165, in the hopes it can be the springboard for action on this issue in the next Congress.
CONGRESSIONAL CHANGES
In the ongoing reshuffling of Congress following the election, Sen. Gregg (R-NH) is giving chairmanship of the Health, Education, Labor & Pensions Committee to take over the Budget Committee from retiring Sen. Nickles (R-OK). (NOTE: in some editions of our last report, Sen. Nickles was listed as a possible NEW chairman of that committee instead of as the departing chairman; we apologize for the error, which several alert readers caught.) As expected, Sen. Durbin (D-IL) will become the second-ranking Democrat in the new Senate, filling the role of Whip. For the number three Democratic post (Conference Secretary), Sen. Mikulski (D-MD) is stepping down and will likely be replaced by Sen. Stabenow (D-MI).
TRUCKING ISSUES
It was reported last week that a proposed rule has been sent to the Office of Management and Budget for clearance that would regulate wetlines on gasoline tanker trucks. We understand the proposed rule would require retrofitting existing trucks to be able to clear all fuel from the lines before moving the transport -- at an estimated cost of $3,000 to $8,000 per truck. We also understand that many states still won’t be ready for the 1/31/05 Hazmat Commercial Drivers License rules, and that there are likely to be some changes made (not necessarily a delay in the implementation date) to accommodate the realities on the ground.
SIGMA Weekly Report November 15, 2004 © Copyright SIGMA, 2005
|
|
 |
|
 |
|
|
|
|
Marquis Sponsor
|
|
|
|
Elite Sponsors
|
|
|
|
|
|
Affiliate Sponsors
|
|
|
|
|
|
|
|
|
Executive Sponsor
|
|
|
|
|
|
|
|
|
|
|
|
Patron Sponsor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
