SOUTH REGIONAL UPDATE
By Hank Behar
The hurricanes may have been scarce this year (thank goodness) but the effects of past high winds linger on in Florida, where getting insurance has become a challenge. South Carolina, long-cherished as one of the low-tax states in cigarettes and gasoline, may be in for a rude shock from the state legislature in January. And North Carolina has to rustle up funds for its underground storage fund. Texas, meanwhile, welcomes a new leader for its petrol and c-store association, as it moves into new quarters down the street.
Insurance problems in Florida are desperately in need of attention, said Jim Smith, president and CEO of the Florida Petroleum Marketers and Convenience Store Association (FPMA).
"The situation is worse than most people realize," declared Smith. "Not only are some home owners who were paying $3,000 a year now being charged up to $17,000, but some of our store owners can't even get insurance to cover essential items such as canopies and signs.
"Their 'last resort' insurance company is the state-backed Citizens Property Insurance Corporation," observed Smith, "but it's mandated to be non-competitive so its premiums are also through the roof. Something has to be done, which is why we're asking the state legislature when it meets Jan. 17 to find a way out."
The legislature has its work cut out for it. As insurance companies scrambled to pull back from high-risk areas, some 186,000 policy holders were scheduled to receive notice before the hurricane season that their policies would not be renewed. The Citizens Corp., their only chance for insurance, was facing a deficit of $1.7 billion, and the Florida Hurricane Catastrophe Fund was saddled with a $1.35 billion deficit this year. The lack of insurance has been seen by some as no less than a threat to the state's economic growth.
In preparation for the special January legislation session a task force was convened to search for solutions. Thus far, some of its recommendations include offering insurers more reinsurance from the State's Catastrophe Reinsurance Fund; eliminating the geographical boundaries that now prevent homeowners from obtaining coverage from Citizens; and allowing home owners to reduce the amount of wind coverage they buy to the amount of the outstanding mortgage.
"We will be at the legislative session," said FPMA president and CEO Smith, "to listen and see what they come up with, especially after our newly elected Governor takes office. Then we will decide our next steps. Until then, the FPMA is keeping its options open as to what we will support and oppose, according to the interests of our association and its members."
South Carolina can rightfully boast that it sports the lowest cigarette taxes in the nation (7 cents per pack) and among of the lowest taxes on gasoline and diesel fuels (16 cents per gallon on each), so it's no wonder that Leigh Faircloth, executive director of the South Carolina Association of Convenience Stores (SCACS) waits in trepidation for the next session of the state legislature, for rumors are flying that an increase in each tax is on, under and around the legislative table.
"Our position will be to watch and wait," said Faircloth, "and if a proposal does come up to boost our taxes, we will try to educate our lawmakers as to the unintended consequences of such a tax hike." What will some of those "unintendeds" be? "A decrease in lottery sales, for one thing," said Faircloth, "since customers will have less discretionary money to spend on lottery tickets and that will directly impact South Carolina's educational system, since lottery profits are strictly mandated for educational purposes.
"Another consequence will be a reduction in tourism, since low tobacco taxes attracts many to our state who take a significant amount of tobacco back home with them. This is particularly true along the coast and border counties," he said.
"The SCACS does have the ear of some legislators so we feel we'll get a fair hearing when the time comes to state our case," said Faircloth, "so we'll be out there, fighting the good fight to keep our taxes reasonable. It's not only in the interest of our members, but in the interest of everyone in our state."
It's also a time of some concern for the underground storage tank trust fund.
"In North Carolina," said Gary Harris, executive director of the North Carolina Petroleum Marketers Association (NCPMA), "the EPA has sent a letter to the Department of Environment and Natural Resources questioning our fund’s solvency. That means we have to think about getting an infusion of cash from somewhere to rescue it. One possibility is the state legislature, but North Carolina, like many states, has on-going budget problems, so there's no guarantee the General Assembly will make the money available."
Harris added, "However, the legislative session runs from late January till June, so we'll have time to pursue different avenues, and hopefully one of them will lead to action by the General Assembly."
If the money doesn't come through, then alternate means of funding will have to be found, which could include higher tank fees, changes in deductibles and private insurance.
When change comes, it sometimes comes in buckets. Such is the case at the Texas Petroleum Marketers and Convenience Store Association (TPCA), the trade association home to 4,000 of the state's 13,000 petroleum marketers and c-stores.
"Our esteemed executive vice president, Lynton Allred, who has served us so well for 11 years, is retiring," said Doug DuBois, TPCA director of membership services and governmental affairs. "Under his leadership we've represented our industry well before the Texas Legislature and the many state regulatory agencies who have purview over our members. Our office staff has been streamlined leveraging technology to maintain the same level of service our members have grown to expect. Most recently, Lynton was honored with the E.K. Bennett Award, named after the first president of TPCA and awarded to the individual who epitomizes the values and conduct Mr. Bennett lived by as a leader of our association."
Replacing him will be Chris Newton, who not only brings a new name to the letterhead, but also a new title, as "Executive Vice President" is changed to "President and CEO." Newton has most recently been in private practice serving as TPCA's general counsel and director of legislative affairs. He brings a wealth of legislative experience to this leadership role as one of the most respected lobbyists in Austin. He served as General Counsel to the Senate Natural Resources Committee prior to joining TPCA in 1996 and before that served in various capacities while attending law school at the University of Texas.
Remaining as Chairman is Doug Phillips, president of Regal Oil, Inc. (San Angelo, Texas).
Along with the move to a new leader is a move to new quarters. Henceforth, the TPCA can be found at 401 West 15th Street, Suite 510, in Austin. "We'll be just down the street from our former offices, in about the same square-footage" says DuBois, "but we'll be more consolidated, so we expect to be working with greater efficiency."
Consolidation is not limited to office operations; it's also continuing out in the field, which is where petroleum marketers and c-stores can be found. "Due to mergers and acquisitions there are now fewer companies in our association than there were a few years ago," noted DuBois, "but the number of store locations hasn't gone down at all; we just have fewer companies representing them now."
The hurricanes may have been scarce this year (thank goodness) but the effects of past high winds linger on in Florida, where getting insurance has become a challenge. South Carolina, long-cherished as one of the low-tax states in cigarettes and gasoline, may be in for a rude shock from the state legislature in January. And North Carolina has to rustle up funds for its underground storage fund. Texas, meanwhile, welcomes a new leader for its petrol and c-store association, as it moves into new quarters down the street.
Insurance problems in Florida are desperately in need of attention, said Jim Smith, president and CEO of the Florida Petroleum Marketers and Convenience Store Association (FPMA).
"The situation is worse than most people realize," declared Smith. "Not only are some home owners who were paying $3,000 a year now being charged up to $17,000, but some of our store owners can't even get insurance to cover essential items such as canopies and signs.
"Their 'last resort' insurance company is the state-backed Citizens Property Insurance Corporation," observed Smith, "but it's mandated to be non-competitive so its premiums are also through the roof. Something has to be done, which is why we're asking the state legislature when it meets Jan. 17 to find a way out."
The legislature has its work cut out for it. As insurance companies scrambled to pull back from high-risk areas, some 186,000 policy holders were scheduled to receive notice before the hurricane season that their policies would not be renewed. The Citizens Corp., their only chance for insurance, was facing a deficit of $1.7 billion, and the Florida Hurricane Catastrophe Fund was saddled with a $1.35 billion deficit this year. The lack of insurance has been seen by some as no less than a threat to the state's economic growth.
In preparation for the special January legislation session a task force was convened to search for solutions. Thus far, some of its recommendations include offering insurers more reinsurance from the State's Catastrophe Reinsurance Fund; eliminating the geographical boundaries that now prevent homeowners from obtaining coverage from Citizens; and allowing home owners to reduce the amount of wind coverage they buy to the amount of the outstanding mortgage.
"We will be at the legislative session," said FPMA president and CEO Smith, "to listen and see what they come up with, especially after our newly elected Governor takes office. Then we will decide our next steps. Until then, the FPMA is keeping its options open as to what we will support and oppose, according to the interests of our association and its members."
South Carolina can rightfully boast that it sports the lowest cigarette taxes in the nation (7 cents per pack) and among of the lowest taxes on gasoline and diesel fuels (16 cents per gallon on each), so it's no wonder that Leigh Faircloth, executive director of the South Carolina Association of Convenience Stores (SCACS) waits in trepidation for the next session of the state legislature, for rumors are flying that an increase in each tax is on, under and around the legislative table.
"Our position will be to watch and wait," said Faircloth, "and if a proposal does come up to boost our taxes, we will try to educate our lawmakers as to the unintended consequences of such a tax hike." What will some of those "unintendeds" be? "A decrease in lottery sales, for one thing," said Faircloth, "since customers will have less discretionary money to spend on lottery tickets and that will directly impact South Carolina's educational system, since lottery profits are strictly mandated for educational purposes.
"Another consequence will be a reduction in tourism, since low tobacco taxes attracts many to our state who take a significant amount of tobacco back home with them. This is particularly true along the coast and border counties," he said.
"The SCACS does have the ear of some legislators so we feel we'll get a fair hearing when the time comes to state our case," said Faircloth, "so we'll be out there, fighting the good fight to keep our taxes reasonable. It's not only in the interest of our members, but in the interest of everyone in our state."
It's also a time of some concern for the underground storage tank trust fund.
"In North Carolina," said Gary Harris, executive director of the North Carolina Petroleum Marketers Association (NCPMA), "the EPA has sent a letter to the Department of Environment and Natural Resources questioning our fund’s solvency. That means we have to think about getting an infusion of cash from somewhere to rescue it. One possibility is the state legislature, but North Carolina, like many states, has on-going budget problems, so there's no guarantee the General Assembly will make the money available."
Harris added, "However, the legislative session runs from late January till June, so we'll have time to pursue different avenues, and hopefully one of them will lead to action by the General Assembly."
If the money doesn't come through, then alternate means of funding will have to be found, which could include higher tank fees, changes in deductibles and private insurance.
When change comes, it sometimes comes in buckets. Such is the case at the Texas Petroleum Marketers and Convenience Store Association (TPCA), the trade association home to 4,000 of the state's 13,000 petroleum marketers and c-stores.
"Our esteemed executive vice president, Lynton Allred, who has served us so well for 11 years, is retiring," said Doug DuBois, TPCA director of membership services and governmental affairs. "Under his leadership we've represented our industry well before the Texas Legislature and the many state regulatory agencies who have purview over our members. Our office staff has been streamlined leveraging technology to maintain the same level of service our members have grown to expect. Most recently, Lynton was honored with the E.K. Bennett Award, named after the first president of TPCA and awarded to the individual who epitomizes the values and conduct Mr. Bennett lived by as a leader of our association."
Replacing him will be Chris Newton, who not only brings a new name to the letterhead, but also a new title, as "Executive Vice President" is changed to "President and CEO." Newton has most recently been in private practice serving as TPCA's general counsel and director of legislative affairs. He brings a wealth of legislative experience to this leadership role as one of the most respected lobbyists in Austin. He served as General Counsel to the Senate Natural Resources Committee prior to joining TPCA in 1996 and before that served in various capacities while attending law school at the University of Texas.
Remaining as Chairman is Doug Phillips, president of Regal Oil, Inc. (San Angelo, Texas).
Along with the move to a new leader is a move to new quarters. Henceforth, the TPCA can be found at 401 West 15th Street, Suite 510, in Austin. "We'll be just down the street from our former offices, in about the same square-footage" says DuBois, "but we'll be more consolidated, so we expect to be working with greater efficiency."
Consolidation is not limited to office operations; it's also continuing out in the field, which is where petroleum marketers and c-stores can be found. "Due to mergers and acquisitions there are now fewer companies in our association than there were a few years ago," noted DuBois, "but the number of store locations hasn't gone down at all; we just have fewer companies representing them now."