News - Local/State

Saturday, Jul. 05, 2008

Paper over plastic at the pump

Local gas stations join national trend to charge more for credit card use

Valencia Jefferson pulled her silver Honda into the Valero gas station on Celanese Road. She needed gas, and the big sign advertising $3.83 a gallon was a good deal.

Jefferson swiped her credit card and started to pump. About $30 later, she realized she was paying $3.90 a gallon. Had she accidentally picked premium grade? No, it was the cheap stuff. Was this a mistake? No. A scam? Nope.

The price on the sign was correct. So was the $3.90 on the screen.

The Corner Store No. 1 on Celanese is the latest local gas station to join a growing national trend: Charging a higher price for customers who pay with plastic.

Owner Dhiren Patel said the pricing isn't designed to be shady. He clearly states "cash price" on his giant roadside sign. On the pump, labels show cash and credit are different prices. Patel said he's trying to cover his growing credit card transaction fees without punishing customers who pay with cash.

"We're paying a lot more in credit card fees with the higher fuel prices," he said.

Recouping skyrocketing fees

Patel explained that he pays a small percentage of each credit or debit card purchase to credit card companies in fees. Because gas prices have nearly quadrupled over the past decade, more filling stations around the country have started looking at ways to recoup the ballooning fees.

The National Association of Convenience Stores has taken the issue to Capitol Hill this year. The filling station advocacy group is asking for federal help to renegotiate the fees charged by major credit card companies. In the past year, NACS members paid $7.6 billion in credit card fees, compared to $3.4 billion in earned profits, the association reports on its Web site.

Because an overwhelming number of customers pay with credit or debit cards and having different prices is a somewhat new practice in York County, some consumers aren't thrilled about having two prices for the same product.

"I think it's misleading," Jefferson said. "It's only good if you happen to pay with cash."

That's the reason the Texaco and Shell stations across the street from the Corner Store charge one flat price. One price, though higher at times, is easier for customers to understand, clerks said.

A few concerns aren't deterring Patel. He began the two-price model Tuesday. He's not short on business, and he says he's already noticing a positive difference to his bottom line.

"A few people have been annoyed," he said. "But I think it helps consumers a little bit at the pump.

"You can't please everybody all the time," he said.