URGENT
Cash/Credit Pricing Rules Clarified
PLEASE READ THIS NOTICE TO AVOID PENALTIES

May 29, 2007

Dear NJGCA Member / Petroleum Retailer,

The sharply rising price of gas at the pumps has created difficulty maintaining profit margins when motorists use a credit card to pay for their purchase.

A ten gallon sale of gas when the price was $2 per gallon cost the motorist $20 and resulted in a credit card fee of 60 cents being charged to the gasoline retailer.

A ten gallon sale of gas today with the price at $3 per gallon now costs the motorist $30 and results in a credit card fee of 90 cents being charged to the gasoline retailer.

The credit card fee is eating into already slim margins and many retailers have chosen to return to dual CASH/CREDIT pricing at the pumps.

Although the law does not allow a merchant to charge consumers to use their credit card, the law does allow merchants to give a “DISCOUNT FOR CASH”.

Present law requires a sign on top of your pump displaying both the cash and the credit price with the cash price displayed above the credit price. You ARE NOT REQUIRED to display prices on oversized street signs. Street signs are promotional in nature and are voluntary on your part.

HOWEVER; when prices are posted on oversized street signs they must be identical to the signs posted on top of the pumps. You can NOT display a lower price at the street than you display on top of the pump. Many retailers have displayed the cash price only at the street while properly displaying the cash and credit price on top of the pumps. This has caused confusion amongst motorists and has resulted in complaints to officials.

The NJ Department of Consumer affairs and NJ Weights and Measures have been deluged with calls accusing gasoline retailers of deceiving the motorist. Last week we received calls from many of you because each county Weights and Measures was interpreting and enforcing the laws differently. Many county officials were requiring that retail gasoline stations post ONLY the credit price since the credit price is the actual price you are charging and signage must match. The cash price just represents a discount.

NJGCA has met with both NJ Weights and Measures and NJ Consumer Affairs to clarify the requirements and to maintain a uniform interpretation and enforcement in each county. It is our belief that the motorist benefits by being offered a cash discount and therefore we should promote this vigorously with curbside signs. We are NOT attempting to deceive the motorist.

State officials recognize that we are attempting promotion rather than deception and have agreed to allow BOTH the cash and credit price to be displayed on the oversized street signs. It is important for you to understand that BOTH the Cash and Credit price must be used and NOT JUST THE CASH PRICE!

Recognizing that street signs have room for three products we have suggested, and NJ officials have agreed that retailers may convert present signage to a ONE product sign.

To properly comply with the law street signs must be Labeled on Top with the words “REGULAR UNLEADED” in CAPITAL letters. The two top spaces must indicate the cash and credit price. The third space would remain empty. If a retailer sells diesel and chooses to use cash/credit pricing then the requirement remains the same that both the cash and credit price be displayed. The empty third space on the oversized sign may then be used as one of the required spaces for the diesel cash price. Another space would still need to be added for the diesel credit price.

Since credit card fees are eating away 6-9 cents on every gallon that you sell I urge you to adopt dual pricing and recoup the profit that you are giving away to the credit card banks. I have enclosed several diagrams that will demonstrate the proper way to display oversized street signs.

The decision to utilize dual pricing is yours alone. If you decide that dual pricing is what is right for your business then it must be done properly to avoid fines and penalties. Fines can range between $50 and $200 with a 5-30 day suspension of your motor fuels license. Legislation has already passed through the NJ Senate and is awaiting action in the Assembly that would increase these fines to $1500 and would result in revocation of your motor fuels license on a second offense.

Weights and Measures will begin enforcement of the oversized street sign requirements on June 1 st.

Again, the decision to utilize dual pricing is yours alone and only yours! You should not allow your supplier or Oil Company to keep you from implementing dual pricing. If there are any attempts to influence you or intimidate you into not utilizing dual pricing you should call the NJGCA office immediately.

It is important that you understand the requirements for posting cash/credit prices on oversize street signs. Please call me if you have any questions. You may also email me sal@NJGCA.org

Regardless of whether you choose to utilize dual pricing or remain at single pricing you should be aware that as an NJGCA member you are entitled to participate in a program that we have negotiated for you that can save you hundreds or thousands of dollars in credit card processing fees. Please call the office if you are not in this valuable program. I think it will be beneficial to your bottom line if you utilize dual pricing to recoup the costs you incur in credit card fees AND save money by enrolling in the NJGCA credit card processing program.

If you do choose dual pricing, PLEASE DO IT CORRECTLY!

Sincerely,

Sal Risalvato
Executive Director NJGCA

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