Proposed Implementation of Special Refund Procedures

DEPARTMENT OF ENERGY

Office of Hearings and Appeals

Proposed Implementation of Special Refund Procedures

AGENCY: Office of Hearings and Appeals, Department of Energy.

ACTION: Notice of proposed implementation of special refund procedures.

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SUMMARY: The Office of Hearings and Appeals (OHA) of the Department of

Energy (DOE) announces the proposed procedures for disbursement of

$866,352.24, plus accrued interest, in refined petroleum product

violation amounts obtained by the DOE pursuant to Consent Orders issued

to Bell Fuels, Inc., et al., Case Nos. LEF-0061, et al. In the absence

of sufficient information to implement direct restitution to injured

customers of the consenting firms, the OHA has tentatively determined

that if no such customers come forward, the funds obtained from these

firms, plus accrued interest, will be made available to state

governments for use in four energy conservation programs.

DATES AND ADDRESSES: Comments must be filed in duplicate on or before

May 15, 1995, and should be addressed to the Office of Hearings and

Appeals, Department of Energy, 1000 Independence Ave., S.W.,

Washington, DC 20585. All comments should display a reference to the

appropriate case number.

FOR FURTHER INFORMATION CONTACT: Thomas O. Mann, Deputy Director, Roger

Klurfeld, Assistant Director, Office of Hearings and Appeals, 1000

Independence Avenue SW., Washington, D.C. 20585, (202) 586-2094 (Mann);

586-2383 (Klurfeld).

SUPPLEMENTARY INFORMATION: In accordance with 10 CFR 205.282(b), notice

is hereby given of the issuance of the Proposed Decision and Order set

out below. The Proposed Decision and Order sets forth the procedures

that the DOE has tentatively formulated to distribute $866,352.24, plus

accrued interest, obtained by the DOE pursuant to Consent Orders issued

to eighteen resellers and retailers of refined petroleum products. The

Consent Orders settled DOE allegations that, during periods between

1973 and 1981, the firms had sold certain refined petroleum products at

prices in excess of the maximum lawful selling price, in violation of

Federal petroleum price regulations. The names of the firms, their case

numbers, the dates of the settlement periods, the products covered by

each Consent Order, and the amounts received from each firm are set

forth in the Appendix to the Proposed Decision.

Since it lacks sufficient information to implement a standard

first-stage refund process, the OHA has tentatively determined to make

all of the funds obtained from the firms available for indirect

restitution in accordance with the provisions of the Petroleum

Overcharge Distribution and Restitution Act of 1986 (PODRA), 15 U.S.C.

4501-07. The funds will be distributed to state governments for use in

four energy conservation programs. Before making the funds available to

the states, however, the OHA will accept refund claims from any injured

customers of the consenting firms who come forward and will devise

refund procedures based on the information these applicants provide.

Any member of the public may submit written comments regarding the

proposed refund procedures. Commenting parties are requested to provide

two copies of their submissions. Comments must be submitted within 30

[[Page 18810]]

days of publication of this notice in the Federal Register and should

be sent to the address set forth at the beginning of this notice. All

comments received in this proceeding will be available for public

inspection between the hours of 1 p.m. and 5 p.m., Monday through

Friday, except federal holidays, in the Public Reference Room of the

Office of Hearings and Appeals, located in Room 1E-234, 1000

Independence Avenue, SW, Washington, DC 20585.

Dated: April 3, 1995.

George B. Breznay,

Director, Office of Hearings and Appeals.

Proposed Decision and Order of the Department of Energy

Implementation of Special Refund Procedures

Names of Firms: Bell Fuels, Inc., et al.

Dates of Filing: July 20, 1993, November 16, 1993

Case Numbers: LEF-0061, et al.

Date: April 3, 1995.

On July 20 and November 16, 1993, the Economic Regulatory

Administration (ERA) of the Department of Energy (DOE) filed Petitions

for the Implementation of Special Refund Procedures with the Office of

Hearings and Appeals (OHA), to distribute the funds received pursuant

to Consent Orders entered into by the DOE and the eighteen petroleum

resellers and retailers listed in the Appendix to this Decision and

Order (hereinafter collectively referred to as the consenting firms).

In accordance with the provisions of the procedural regulations at 10

C.F.R. Part 205, Subpart V (Subpart V), the ERA requests in its

Petitions that the OHA establish special procedures to make refunds in

order to remedy the effects of regulatory violations set forth in the

Consent Orders.

I. Background

Each of the consenting firms was a reseller or retailer of refined

petroleum products during the periods relevant to this proceeding. ERA

audits of the consenting firms revealed possible violations of the

Mandatory Petroleum Price Regulations. Subsequently, each of these

firms entered into a separate Consent Order with the DOE in order to

settle its disputes with the DOE concerning certain sales of refined

petroleum products. Pursuant to these Consent Orders, the firms agreed

to pay to the DOE specified amounts in settlement of their potential

liability with respect to sales to their customers during the

settlement periods. The firms' payments are currently being held in

separate interest-bearing accounts pending distribution by the DOE. The

names of the firms, their addresses, the dates of the settlement

periods and of the Consent Orders, the amount received from each firm,

and the products covered by each Consent Order are set forth in the

Appendix to this Proposed Decision.

II. Jurisdiction and Authority

The Subpart V regulations set forth general guidelines which may be

used by the OHA in formulating and implementing a plan of distribution

of funds received as a result of an enforcement proceeding. The DOE

policy is to use the Subpart V process to distribute such funds. For a

more detailed discussion of Subpart V and the authority of the OHA to

fashion procedures to distribute refunds, see Petroleum Overcharge

Distribution and Restitution Act of 1986, 15 U.S.C. Secs. 4501 et seq.,

Office of Enforcement, 9 DOE para.82,508 (1981), and Office of

Enforcement, 8 DOE para.82,597 (1981) (Vickers).

II. Proposed Refund Procedures

In cases where the ERA is unable to identify parties injured by the

alleged overcharges or the specific amounts to which they may be

entitled, we normally implement a two-stage refund procedure. In the

first stage of such a proceeding, those who bought refined petroleum

products from the consenting firms may apply for refunds, which are

calculated on a pro-rata or volumetric basis. In order to calculate the

volumetric refund amount, the OHA divides the amount of money available

for direct restitution by the number of gallons sold by the firm during

the period covered by the consent order. In the second stage, any funds

remaining after all first-stage claims are decided are distributed in

accordance with PODRA.

In the cases covered by this Proposed Decision, however, we lack

much of the information that we normally use to provide direct

restitution to injured customers of the consenting firms. In

particular, we have been unable to obtain any information on the

volumes of the relevant petroleum products sold by the consenting firms

during the settlement period. Nor do we have any information concerning

the customers of these firms. Based on the present state of the record

in these cases, it would be difficult to implement a volumetric refund

process. Nevertheless, we will accept any refund claims submitted by

persons who purchased the products specified in the Appendix from the

consenting firms during the periods shown in the Appendix. We will work

with those claimants to develop additional information that would

enable us to determine who should receive refunds and in what amounts.

If no claims are received, we propose to distribute all of the

funds received from the consenting firms in accordance with the

provisions of PODRA. See Green Oil Company, 20 DOE para.85,450 (1990).

PODRA requires that the Secretary of Energy determine annually the

amount of oil overcharge funds that will not be required to refund

monies to injured parties in Subpart V proceedings and make those funds

available to state governments for use in four energy conservation

programs.

Before taking this action, we intend to publicize our proposal and

solicit comments from interested parties. We invite anyone who has

information concerning the consenting firms sales during the

settlement period to submit that information. Comments concerning the

tentative distribution process set forth in this Proposed Decision and

Order should be filed with the OHA within 30 days of its publication in

the Federal Register.

It Is Therefore Ordered That:

The payments remitted to the Department of Energy by the firms

listed in the Appendix to this Decision and Order pursuant to the

Consent Orders whose dates are set forth in the Appendix will be

distributed in accordance with the foregoing Decision.

Appendix

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Date of

Case No., firm Address Settlement period consent Amount Product

order received

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LEF-0061, Bell Fuels, Inc........ 4116 W. Peterson Ave., Chicago, 1/1/79-11/30/79 8/31/82 $33,973.12 Gasoline.

IL 60646.

LEF-0062, Este Oil Company....... 5556 Vine St., Cincinnati, OH 11/1/73-1/28/81 5/13/83 63,033.90 Refined petroleum products.

45217.

[[Page 18811]]

LEF-0063, G&G Oil Co. of Indiana, 220 E. Centennial Ave., Muncie, 4/1/79-12/31/79 2/1/83 49,097.11 Refined petroleum products.

Inc. IN 47305.

LEF-0064, General Petroleum P.O. Box 209, Gary, IN 46402.... 11/1/73-4/30/74 7/13/83 23,060.52 Refined petroleum products.

Products, Inc.

LEF-0065, Reco Petroleum, Inc.... 100 N. 4th St., Reading, PA 3/1/79-1/30/81 2/8/83 26,472.40 Gasoline.

19601.

LEF-0066, SOS Monarch Oil Corp... East Village Rd., Tuxedo, NY 4/1/79-9/30/79 10/25/82 5,901.03 Gasoline.

10987.

LEF-0067, Capitol 66 oil Company. P.O. Box 2839, Jackson, MS 39207 11/1/73-3/31/74 9/15/82 15,766.43 Refined petroleum products.

LEF-0068, Cumberland Farms Dairy, 777 Dedham St., Canton, MA 02021 1/1/73-1/28/81 4/17/83 183,193.74 Gasoline.

Inc.

LEF-0069, Kickapoo Oil Co........ 215 E. Madison, Hillsboro, WI 3/1/79-8/31/79 9/24/82 40,812.58 Gasoline.

54634.

LEF-0070, Lampton-Love, Inc...... P.O. Drawer 1607, Jackson, MS 11/73-4/74 9/30/82 12,983.93 Gasoline.

39205.

LEF-0071, Skinny's Inc........... 5189 Texas Ave., Abilene, TX 3/1/79-3/31/80 9/2/82 16,000.00 Gasoline.

79608.

LEF-0072, Vermont Morgan Corp.... 114 Broadway, Saratoga, NY 12866 4/1/79-6/30/79 4/5/83 20,275.00 Gasoline.

LEF-0075, Bob's Broadway Shell... 220 W. 17th St., Santa Ana, CA 8/1/79-5/7/80 10/8/81 2,100.00 Gasoline.

92708.

LEF-0076, Clearview Gulf......... 3120 Clearview Parkway, 4/1/79-7/15/79 8/14/81 594.84 Gasoline.

Metairie, LA 70002.

LEF-0077, E-Z Serve, Inc......... P.O. Box 3579, Abilene, TX 79604 8/19/73-1/27/81 12/27/82 368,550.56 Gasoline.

LEF-0079. Millbrae Shell......... 825 Spruance Ln., Foster City, 8/1/79-11/30/79 3/5/82 2,500.00 Gasoline.

CA 94404.

LEF-0080, Bob Hutchinson, Inc.... 1334 Breckenridge St., San 8/1/79-11/30/79 3/5/82 1,762.00 Gasoline.

Leandro, CA 94579.

LEF-0016, Maxwell Oil Co., Inc... P.O. Box 1936, Olympia, WA 98507 5/1/79-12/1/79 9/1/81 275.01 Gasoline.

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[FR Doc. 95-9172 Filed 4-12-95; 8:45 am]

BILLING CODE 6450-01-P