March 18, 2011

Dear NJGCA Member:

Here's what you'll find in this edition of the NJGCA Road Warrior, and thank you for reading:

EXECUTIVE DIRECTOR'S MESSAGE: GREETINGS & SAL-UTATIONS!
•Volatile Prices, Profits, Nuclear Power and CHANGING YOUR PRICE ONCE A WEEK?!

NEWS AROUND THE STATE
•State union proposes to cover 20% of health benefits
•Predatory Towing: State goes after towing companies for utilizing illegal tactics
•New Education Commissioner creates Charter Office
•Towns seek to exceed 2% property tax hike by seeking voter approval

A SPECIAL MESSAGE FROM BELLOMO FUELS
•Serving New Jersey since 1910 -- Over 100 years of supplying gasoline retailers like YOU!

TRAINING CLASS SCHEDULE
•Let us know what your education needs are today!

POLITICAL PARTICIPATON: THE NJGCA PAC
•Participate in the NJGCA PAC today and help us keep our Agenda rolling in Trenton!

THE MEMBER TOOL BOX
•On the NJGCA Homepage
•Know your Territory Manager!

 EXECUTIVE DIRECTOR'S MESSAGE: GREETINGS & SAL-UTATIONS! 

VOLATILE PRICES, PROFITS, NUCLEAR POWER, AND...
ONLY CHANGE YOUR PUMP PRICE ONCE A WEEK……YEA RIGHT???....NOT WITHOUT A NUCLEAR WAR THAT WE WILL START!

What a difference a week makes!

Gas prices have been climbing higher and higher for nearly a month now, eating into your profits and harming the motorists who patronize your small business.

This week, however, a natural disaster halfway around the world and stagnant demand for gasoline have resulted a rack price drop of approximately 17¢ a gallon in only a few short days.  While all experts agree that the tsunami in Japan is having a small impact on our fuel costs, a dip in domestic demand is far more significant.  That’s because the economy cannot sustain these higher gas prices for long – which is what I’ve been saying all along.

Between fuel supplies remaining plentiful (even as demand has dipped slightly in the last few weeks) and the anticipated (and feared) havoc in the Middle East failing to affect oil production (thus far), the market has had no option but to retreat from where we were only 10 days ago. 

So what happens next?  I haven’t a clue!  The entire situation is out of whack and this can all change in a heartbeat. What’s more, the market is only reacting to what information is out there, so just having investors watching a newscast can send things spiraling one direction or another.  If the ordinary laws of supply and demand were totally in affect, I’d predict prices would continue to drop for a few weeks.  But, as we all know, this isn’t a transparent market and for weeks, speculators have been driving up the cost of oil to create a higher return on their investment.  That means things are unpredictable – and are likely to remain that way for awhile.

Pump prices falling so quickly, however, does create an opportunity for you to grab a little more profit.  This means that you shouldn’t be the first guy on your block to race to the bottom of the new daily price.  Rather, you should gradually ride the wave down to make up for the meager profits you’ve been clinging to for the last to few weeks.  Some people may call you greedy for doing this, but I call it necessary.  You simply cannot live on near-zero profits for a month without taking advantage of the marketplace when it allows.

Remember last week when I mentioned legislators doing very stupid things to make the public think they are trying to fight these high gas prices??  Well one legislator that I will not name right now is proposing to introduce legislation that will prohibit you from raising your pump prices more than once a week.  Don’t panic yet!!  Our friends at FMANJ have alerted me of this.  Many of you know that I have been out of the office for over a month, but my ear is still to the ground.  I am strategizing with my counterpart at FMANJ, Eric DeGesero, and we plan to meet with this legislator to educate her about the harm that she would do to you and for that matter the motoring public.  If my surgeon gives me the ok, I hope to be back on a limited basis as early as next week.  My first priority will be to handle this issue.

Along with all of this news from Japan come renewed attacks on nuclear power.  You know that I have been an outspoken supporter of nuclear energy for some time.  In fact, I first wrote about it in an August 2009 Road Warrior, outlining the benefits of constructing new atomic plants throughout the United States.

What is truly upsetting about these newscasts out of Japan is that the ‘meltdown’ they speak of wasn’t caused by the initial earthquake or any kind of safety failure.  In fact, the reactor shut itself down as soon as the seismographs detected the earthquake.  Instead, the mass influx of water carried by the tsunami is negatively affecting their cooling systems.

Rather than focus on that unforeseen issue, however, the American press keeps on comparing the situation to Chernobyl (which was a disaster) and Three-Mile Island (which wasn’t).  All of this ignores what is really going on in Japan and stokes up anti-nuclear power sentiment among the populace.  Even the Editorial Board at the Star-Ledger recently penned a piece calling this phenomenon ‘Three Mile Island Syndrome’.  You can read it by clicking HERE

You maybe thinking that this has nothing to do with you, but you couldn’t be more wrong.  YOU are in the energy business.  True, you dispense liquid energy, but the day is fast approaching where you will be may be dispensing electrical energy side-by-side with your gas pumps.  With America’s energy infrastructure woefully in need of updating, utilizing nuclear power may present the cheapest, cleanest, renewable energy source to produce massive quantities of electricity for the nation. 

Of course, you don’t have to take my word for it, but only have to look around the globe.  Great Britain, Spain, South Korea, China, and 26 other nations produce electricity from nuclear power without any protest.  What’s more, nations like France, Belgium, Armenia and Hungry get a significant amount of electricity from nuclear power (France alone gets over 75% of their power from atomic plants).  Should we do any differently, especially as our needs will only increase in the years ahead?  Rather than focusing on fear-tactics, the emphasis should be placed on improving the safety record of nuclear plants. 

A few things are on the horizon that we are working on.  I will repeat…The first issue is to kill the introduction of the STUPID legislation which would permit you to only change your street price ONCE A WEEK.  I’m just as stunned by this feel-good nonsense as you are.

The second priority is to stop bad Cash/Credit Signage bill from making its way thru the Assembly.  The NJ Senate is ready to vote on a bill that changes current regulations by making them a law dictated by the legislature rather than a code that is enforced by the Department of Consumer Affairs.  We agreed to this change rather than have the legislature pass a bill that would have added additional penalties on top of those already regulated by Weights and Measures.  However, the bill has moved to the Assembly and once again, reaction to the high prices on the street has prompted an Assemblyman to amend the Assembly version and wreak havoc with your street signs.  Again, our friends at FMANJ and I will be working to stop the amended version from passing.  I will keep you updated.

Both the Below Cost Selling and Internet Lottery issues are still on the table and we are still negotiating a favorable conclusion.

Here is another really stupid piece of feel good legislation…..Another bill which is currently being worked on seeks to ban bath salts from being sold.  Since many c-stores sell these as side-items, you should know that many of these salts contain an over the counter stimulant called mephedrone (also known as MDPV).  The bill is a response to the murder of a Rutgers student by her boyfriend, who was allegedly affected by bath salts.

No action has been taken yet, but you should be aware of what’s going on out there.  We will update you as we learn more, but you should keep these on the backburner for the time being.

Thanks for listening - See you next week!

Regards,
Sal Risalvato
Executive Director

NEWS AROUND THE STATE

3/17/2011:
State union proposes to cover 20% of health benefits
In a preemptive move aimed at helping convince legislators not to revise current laws, New Jersey’s largest public employee union has proposed a plan which would have workers cover a larger portion of their health state benefits.  After Governor Christie declared his intent to see such issues handled through legislation, the union offer is seen as a defensive measure to persuade lawmakers that more savings can found at the bargaining table than through sweeping legislation. Union officials say their plan would save over $200 million a year by 2013 by increasing monthly contributions and hiking doctor co-pays.  The offer falls short of Governor Christie and Senate President Steve Sweeney’s reform plan, which seeks a 30% health benefit contribution from union members.

3/13/2011:
Predatory Towing: State goes after towing companies for utilizing illegal tactics
The State Division of Consumer Affairs has recently declared that it will aggressively go after companies that engage in predatory towing practices after a recent rash of incidents.  These unethical outfits use spotters to scan parking lots, tow vehicles away from unsuspecting motorists, and then charge enormous fees to get their vehicles returned.  As this kind of behavior taints the reputation of all honest small business towing companies, NJGCA supports all efforts to fine any outfit knowing harming motorists or betrays the public trust.

3/10/2011:
New Education Commissioner creates Charter Office
Christopher Cerf, New Jersey’s Acting Commission of Education, has started reorganizing 700+ employees in the Department of Education by creating a Charter School Office.  Increasing the number of charter schools, as well as expanding the number of authorizing agencies in state, is a key component of the Governor’s education reform agenda. The Charter School Office will oversee the current 97 charter schools operating in the state and review new applicants.

3/10/2011:
Towns seek to exceed 2% property tax hike by seeking voter approval
With all the elements of Governor Christie’s municipal tool-kit reforms still being debated in the Legislature, and with local government costs rising, at least 27 towns are seeking voter approval to raise taxes above the statutorily limited 2% property tax cap.

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