1. This organization was referred to in the Resolution as the
"Hawaii Retail Gasoline Dealers Association".
2. Letter to researcher from Richard C. Botti, Executive
Director, Hawaii Automotive and Retail Gasoline Dealers
Association, dated July 20, 1995.
3. The members of the HPMA are as follows: Akana Petroleum
(Hilo), Alii Petroleum (Honolulu), Aloha Petroleum
(Honolulu), B & E Petroleum (Kaneohe), Big Island Petroleum
(Kailua-Kona), Diamond Head Petroleum (Honolulu), Garlow
Petroleum (Honolulu), Hawaii Petroleum (Hilo), Kauai
Petroleum (Kapaa), Kewalo Marine Service (Honolulu), Maui
Oil (Kahalui), Maui Petroleum (Kahalui), Pacific Petroleum
(Honolulu), and Senter Petroleum (Kailua). Telephone
interview with Alec McBarnet Jr., Vice-President of the
Hawaii Petroleum Marketers Association, August 23, 1995, and
letter to researcher from the Hawaii Petroleum Marketers
Association, postmarked September 7, 1995.
4. See Walter Miklius and Sumner J. LaCroix, Divorcement
Legislation and the Impact on Gasoline Retailing in the
United States and Hawaii (Honolulu: University of Hawaii,
January 20, 1993) at 56.
5. Letter to researcher from David Young, Public Affairs
Manager, Chevron U.S.A. Products Co., and Chairman of the
Hawaii Petroleum Resources Group, dated September 20, 1995.
6. See Miklius and LaCroix at 56.
7. The Bureau's survey was forwarded to WSPA's general offices
in California, from which it was distributed to all WSPA
companies doing business in Hawaii. In a letter to this
researcher, the chairman of WSPA's Hawaii Petroleum
Resources Group stated that: "WSPA itself has no analytical
capacity nor an extensive legal staff. From our experience
in answering your survey, I can assure you that the time,
expertise and effort necessary to provide you with answers
would be far beyond the association's capacity." Chevron
and Shell therefore responded individually. Letter to
researcher from David Young, supra note 5.
8. Letter from Yukio Naito, Chairman of the Public Utilities
Commission, to Wendell K. Kimura, Director, Legislative
Reference Bureau, dated June 2, 1995.
9. Letter memorandum from Kathryn S. Matayoshi, Director of
Commerce and Consumer Affairs, to Wendell K. Kimura, dated
June 8, 1995.
10. See Julia E. Schoen, The Consumer and Gasoline Marketing in
Hawaii: The Impact of Direct Retailing of Motor Fuel by
Refiners and Distributors on the Consumer (Honolulu: Hawaii
Department of Commerce and Consumer Affairs, 1992 (interim
study) and 1993 (final report)). For example, the
Resolution requests the views of the Department on the
effects of establishing a public bulk gasoline terminal
facility, a petroleum regulatory commission, and a public
petroleum products storage authority, none of which are
addressed in the Department's study.
11. The position of the Public Utilities Commission with regard
to the implementation of the Petroleum Industry Information
Reporting Act of 1991 (chapter 486I, Hawaii Revised
Statutes) is reported in chapter 13.
12. Although the definition of "manufacturer" in section 486H-1,
Hawaii Revised Statutes, refers to specific manufacturers in
existence on January 1, 1992, for purposes of chapter 486H,
Hawaii Revised Statutes (gasoline dealers), that definition
has been amended to refer to manufacturers generally.
13. Chapter 286, Hawaii Revised Statutes, relates to highway
safety.
14. MacAvoy, Paul W., ed., Federal Energy Administration
Regulation: Report of the Presidential Task Force
(Washington, DC: American Enterprise Institute for Public
Policy Research, 1977) at 177.
15. United States, Department of Energy, The Motor Gasoline
Industry: Past, Present, and Future (Washington, DC: Jan.
1991) at 54 (hereinafter "DOE (1991)").
16. Haw. Rev. Stat., §486H-10(a), as amended by Act 238, Session
Laws of Hawaii 1995. The term implies that the retail
outlet is under the direct control of a major oil company
which is able to set the retail product price and directly
collect all or part of the retail margin. The term also
includes retail outlets being operated by salaried employees
of the oil company or its subsidiaries and affiliates, and
may involve personnel services contracted by the oil
company. See definition of "refiner-operated retail outlet"
in David J. Teece, "Vertical Integration in the U.S. Oil
Industry", in Vertical Integration in the Oil Industry,
Edward J. Mitchell, ed., (Washington, DC: American
Enterprise Institute for Public Policy Research, 1976)
(Appendix 1: Definitions Used in the Federal Energy
Administration's Refiner/Importer Historical Report on
Petroleum Products Distribution) at 184.
17. DOE (1991) at 54.
18. MacAvoy (1977) at 189.
19. Id.
20. Haw. Rev. Stat. §486H-10(a), as amended by Act 238, Session
Laws of Hawaii 1995.
21. Massachusetts, Open Supply and Divorcement Task Force,
Report Concerning House Bills H861 and H4490 Currently
Before the Joint Committee on Energy (Boston: Aug. 11,
1993) at 1 (hereinafter, "Mass. Task Force"); Hawaii,
Department of the Attorney General, An Investigation of
Gasoline Prices in Hawaii: A Preliminary Report (Honolulu:
Sept. 1990) at 6 (hereinafter, "AG (1990)").
22. Hawaii, Department of the Attorney General, Gasoline Prices
in Hawaii: The Impact of Oil Company Divorcement on
Consumer Prices (Honolulu: 1993) at 1 (hereinafter, "AG
(1993)"); Hawaii, Department of the Attorney General, The
Attorney General's 1994 Interim Report on the Investigation
of Gasoline Prices (Honolulu: 1994) at 19 (hereinafter, "AG (1994)").
23. MacAvoy (1977) at 181.
24. DOE (1991) at 53.
25. MacAvoy (1977) at 181.
26. AG (1994) at 4-5; AG (1990) at 11; see also Nancy D.
Yamaguchi and David T. Isaak, Hawaii and the World Oil
Market: An Overview for Citizens and Policymakers
(Honolulu: East-West Center Energy Program, August 1990) at 73-74.
27. MacAvoy (1977) at 181.
28. Mass. Task Force at 1.
29. Teece (1976) at 183-184.
30. Mass. Task Force at 1.
31. DOE (1991) at 55.
32. Teece (1976) at 184.
33. United States, General Accounting Office, Energy Security
and Policy: Analysis of the Pricing of Crude Oil and
Petroleum Products (Washington, DC: March 1993) at 127;
Arizona, Joint Legislative Study Committee on Petroleum
Pricing and Marketing Practices and Petroleum Producer
Retail Divorcement, Final Report (Dec. 1988) (App. A) at 17.
34. AG (1990) at 7.
35. See generally Herbert Hovenkamp, Federal Antitrust Policy:
The Law of Competition and its Practice (St. Paul: West
Publishing Co., 1994) at 262-263 and 516-531; see also
Graham Bannock, R. E. Baxter, and Evan Davis, The Penguin
Dictionary of Economics (London: Penguin Books, 1987) at
322-323.
36. MacAvoy (1977) at 186.
37. Jeffrey L. Spears, "Note: Arguments For and Against
Legislative Attacks on Downstream Vertical Integration in
the Oil Industry," 80 Kentucky L.J. 1075 at 1078 (Summer,
1992); see also AG (1993) at 26.
38. MacAvoy (1977) at 187.
39. Mass. Task Force at 1-2.
40. DOE (1991) at 55-56.
41. See House Bill No. 1652, introduced in the Eighteenth
Legislature 1995, State of Hawaii, at 5 (lines 11-17).
42. Id. at 5 (lines 18-20).
43. MacAvoy (1977) at 189.
44. Hawaii Revised Statutes §342L-1. The definition in section
342L-1 further provides that the term does not include any
of the following:
(1) Farm or residential tank of one thousand one hundred
gallons or less capacity used for storing motor fuel
for noncommercial purposes;
(2) Tank used for storing heating oil for
consumptive use on the premises where stored;
(3) Septic tank;
(4) Pipeline facility (including gathering lines)
regulated under:
(A) The federal Natural Gas Pipeline Safety
Act of 1968, Public Law 90-481, as
amended; or
(B) The federal Hazardous Liquid Pipeline
Safety Act of 1979, Public Law 96-129, as
amended;
(5) Surface impoundment, pit, pond, or lagoon;
(6) Storm water or wastewater collection system;
(7) Flow-through process tank;
(8) Liquid trap or associated gathering lines
directly related to oil or gas production and
gathering operations; and
(9) Storage tank situated in an underground area
(such as a basement, cellar, mineworking,
drift, shaft, or tunnel) if the storage tank is
situated upon or above the surface of the
floor.
45. MacAvoy (1977) at 190.
46. Tenn. Code Ann., §47-25-602(10) (1994); see also Black's Law
Dictionary, 5th ed. (St. Paul, MN: West Publishing Co.,
1979) at 1401.
47. See Tenn. Code Ann., §47-25-602(11) (1994).
48. See AG (1993); Miklius and LaCroix (1993).
49. AG (1994) at 13.
50. See, e.g., Arizona, Joint Legislative Study Committee on
Petroleum Pricing and Marketing Practices and Petroleum
Producer Retail Divorcement Final Report (Dec. 1988);
Massachusetts, Open Supply and Divorcement Task Force Report
Concerning House Bills H861 and H4490 Currently Before the
Joint Committee on Energy (Boston: Aug. 11, 1993); Virginia
General Assembly, Report of the Joint Subcommittee Studying
Divorcement and Representative Offering for Inclusion in the
Virginia Petroleum Products Franchise Act (Richmond: 1991).
Prior to the adoption of House Resolution No. 174, H.D. 2,
an earlier bill request that the Bureau study the issues
contained in the Resolution in consultation with other
agencies and over a longer period of time was deleted in
conference committee. Senate Bill No. 487, later codified
as Act 238, Session Laws of Hawaii 1995, would have required
the Bureau to study divorcement and the other issues
specified in the House Resolution "in consultation with the
attorney general, the department of commerce and consumer
affairs, the department of business, economic development,
and tourism, the public utilities commission, and any other
appropriate government agencies" and to "consult with
representatives of the refining oil companies, nonrefiner
oil companies, lessee dealers, open dealers, and jobbers".
Under that bill, the Bureau was to submit an interim report
to the Legislature prior to the convening of the Regular
Session of 1996, and a final report prior to the 1997
Regular Session. See Senate Bill No. 487, S.D. 1, H.D. 1,
§5 (1995). That section, however, was deleted in the C.D. 1
version of that bill, according to the Conference Committee
Report, since "further study of this issue is not
necessary". See Conference Committee Report No. 128 with
respect to Senate Bill No. 487, C.D. 1, dated April 28,
1995.
Chapter 1
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Chapter 2
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Table of Contents
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