[Congressional Record Volume 140, Number 143 (Wednesday, October 5, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: October 5, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
            THE PETROLEUM MARKETING PRACTICES ACT AMENDMENTS

  Mr. FORD. Mr. President, I rise today in support of H.R. 1520, which 
is identical to my bill, S. 338 the Petroleum Marketing Practices Act 
amendments.
  It is my hope that this bill will provide a small but important 
example of the loosening of gridlock, and the reduction of the 
stranglehold on our legislative process. This compromise legislation 
was overwhelmingly supported by all interested parties during the last 
Congress. It passed the House and Senate Energy Committees unanimously. 
It was strongly supported by all elements of the petroleum marketing 
industry. And it should have become law 2 years ago. Today, we have 
before us legislation that has again obtained overwhelming support by 
all interested parties. The Senate Energy Committee held a hearing on 
this bill last year and the committee reported the amended bill by a 
unanimous voice vote on September 21, 1994. I am determined, along with 
many of my Senate colleagues and Chairman Dingell and others in the 
House, to see that this important legislation becomes law this year.
  The Petroleum Marketing Practices Act was enacted in 1978 as a 
``dealer's day in court'' bill, to provide fairness and balance in 
negotiations between franchisors and franchisees involved in gasoline 
marketing. I have had an interest in this issue for several years now. 
It took nearly a decade to negotiate the original 1978 legislation. 
Since that time, a complex series of judicial decisions have led many 
to believe that the original statute is in need of fine tuning. In each 
of the last three Congresses, bills were introduced and hearings were 
held to reform the PMPA.
  Today, after a series of negotiations among all interested parties on 
this issue, including service station dealers, jobbers, and oil 
companies, we have negotiated a new compromise which is reflected in 
the bill which is before us today.
  The Petroleum Marketing Practices Act amendments would among other 
things, clarify the grounds for nonrenewal of a franchise relationship. 
Current law sets forth the only permissible grounds for termination or 
nonrenewal of a gasoline marketing franchise agreement. Nonrenewal may 
occur if there is a failure to agree to changes or additions to the 
franchise, so long as the new conditions are negotiated in good faith 
and not for the purpose of preventing the franchise removal. The 
interpretation of this section of current law has been somewhat 
subjective and confusing. The legislation before us today clarifies one 
major area of uncertainty. It makes explicit that preventing renewal 
includes situations where new conditions are proposed for the purpose 
of converting a franchisee operation into one operated by a 
franchisor's employees. In other words, a gasoline marketer cannot 
force conditions upon an independently operated service station for the 
purpose of converting it into a company-owned station. This is an 
important clarification to existing law.
  While this important explanation and many other of the issues 
addressed in the bill are technical in nature, I believe that they will 
serve to bring a balance to the operation of the PMPA which will assure 
fairness in bargaining in the future. I am pleased by the support this 
legislation enjoys from all affected parties in the gasoline marketing 
industry. The efforts to achieve meaningful PMPA reform have been in 
motion for several years, and I believe we now have a compromise which 
will serve in the best interests of the entire industry. Such a 
compromise could not have been achieved without the hard work and 
support of many of my colleagues, particularly Chairman Johnston, 
ranking minority member Senator Wallop and Senator Wellstone. I 
appreciate the efforts of all who have helped fashion this compromise 
legislation that addresses these complex issues in plain and clear 
language.
  I urge prompt adoption of this important legislation.
  Mr. President, in debating this legislation, the issue of Federal 
pre-emption of State laws has caused particular difficulty. I would 
like to take this opportunity to stress, yet again, what I believe 
should be clear from the language of the committee report and the 
additional views of my friend and colleague from Minnesota: in passing 
this bill, aside from the two specific changes regarding goodwill and 
transfer of the franchise upon the death of the franchisee, we do not 
at this time take any action whatsoever on the issue of pre-emption. We 
neither endorse nor reject any court's interpretation of pre-emption 
law under the Petroleum Marketing Practices Act. We could not come to 
agreement on the issue, so we simply do not mean to address it in this 
bill.
  Mr. WELLSTONE. I thank my friend from Kentucky for his hard work and 
infinite patience in moving this bill. It will certainly serve to 
better the lot of independent service station dealers nationwide.
  It is my understanding, as well, that we will revisit the pre-emption 
issue next year. Service station dealers in Minnesota and throughout 
the country have indicated that resolving the pre-emption issue is of 
great importance to them.
  Mr. DeCONCINI. I join my colleague in the belief that it is very 
important to address the issue of pre-emption. This issue is very 
important not only to my State of Arizona, but nationwide, and Congress 
must revisit it next year and craft a resolution which serves the best 
interest of all involved.
  Mr. FORD. I agree that resolving the pre-emption issue is of extreme 
importance and I intend to work diligently next year to see that we 
address that issue. I will work with other Senators in an effort to 
hold hearings early in 1995.
  Mr. JOHNSTON. That is my understanding as well. Since we did not deal 
with the pre-emption issue this year, I fully intend to bring it up and 
try to resolve it early next year. I ask my friend the Senator from 
Wyoming, as the ranking minority member of the Energy Committee, 
whether he agrees with the statement of the Senator from Kentucky.
  Mr. WALLOP. Mr. President, I agree with the comments of Senator Ford 
with respect to the intent of the committee on the issue of pre-
emption. If Congress wishes to further address pre-emption, then it 
will have to take up that matter next Congress.

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