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Gas station dealers pump up officials

by Kevin James Shay | Staff Writer

Some Maryland gas station owners are concerned about what they say is a plan to sell off some stations to the highest bidder, which they said would reduce local ownership of the businesses.

The stations would likely be sold to out-of-town buyers and could be forced to close, raise gas prices to pay for acquisition costs or “be converted into a mini-mart,” according to a message in a newspaper advertisement last week signed by “local Exxon and Shell dealers.”

The ad urges people to support state Senate and House bills that would prohibit a gasoline producer or refiner from transferring or assigning an interest in a gas station without offering a right of first refusal to the dealer who leases the premises. The legislation is led by Del. Mary Ann Love (D-Dist. 32) of Glen Burnie and Sen. Catherine E. Pugh (D-Dist. 40) of Baltimore and has attracted numerous co-sponsors.

A hearing is scheduled for March 5 in the state House Economic Matters Committee.

“I have a lot of concerns about making sure that the existence of small businesses and mom-and-pop shops remain viable in our community and ensuring that small business still has a place in this industry,” said Del. Herman L. Taylor Jr. (D-Dist. 14) of Ashton, who was not an initial sponsor of the bill. “We need to make sure they have opportunity.”

A spokeswoman for Exxon Mobil Corp. referred to a statement made in June about the oil company’s intention to “transition out of the direct served (i.e., dealer, company operated) retail business” across the nation, calling the move “the best way for ExxonMobil to compete and grow in the future.” ExxonMobil stations will be converted in many markets to branded distributorship network over several years, executives said.

In Maryland, many stations are owned by Exxon Mobil but operated by dealers as franchises. Royal Dutch Shell stations are also affected, dealers say.

A spokeswoman for Shell’s U.S. operations in Houston said last week she did not have an immediate comment as executives needed to review the legislation.

The sell-off of service station properties by oil companies has actually been going on for some time across the country, said Paul Fiore, director of government affairs for the Washington, Maryland, Delaware Service Station and Automotive Repair Association in Bowie.

“One could say the major oil companies are essentially out of the retail business,” Fiore said. “Shell has, more than likely, completed the sale in the mid-Atlantic area, leaving Exxon and Sunoco.”

The service station association “definitely” supports the Maryland gas station legislation, Fiore said.

But the Maryland Chamber of Commerce does not. Chamber officials called the legislation “an unwarranted intrusion of government into the commercial transactions of private parties. … By attempting to force owners of gasoline stations to offer a right of first refusal to tenants, this bill would inhibit the property owners from obtaining market value for their properties, or bundling multiple properties for sale as a package.”

Staff Writer Steve Monroe contributed to this report.

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