Ky Mayor Attacks High Gas Prices by Opening City-Run Fueling Station, Gets Accused of “Socialism"

[A Little Weird]

Somerset, located about 130 miles southeast of Louisville, refurbished a shuttered municipal gas station and opened it to the public last Saturday. After complaints from some of the city’s 11,000 residents about unfairly high gas prices during the summer, Mayor Ed Girdler decided to run his own station. City officials told the Associated Press that gas stations in surrounding areas have typically been charging 20 to 30 cents less per gallon and that a city-run gas station would bring more people to Somerset, which draws vacationers heading to Lake Cumberland. Almost immediately after the Somerset Fuel Center opened with a $3.36-per-gallon price, the major private gas stations a half-mile away cut prices by about 10 cents to try to match it.

The 10 pumps—all regular grade, plus one for compressed natural gas—are owned and operated by Somerset and the prices set by the mayor’s office. To keep costs low, the fuel comes from a local refinery, there’s no candy for sale and no bathrooms, and the 10 attendants (to handle cash) are city employees on rotation from other departments. The city spent $75,000 to upgrade the pumps and install credit-card machines, and that’s it.

“We’re not putting anyone out of business, we’re just trying to lower prices,” station manager Melody Price told us. “Everyone out here is happy.”

http://blog.caranddriver.com/kentucky-mayor-attacks-high-gas-prices-by-opening-city-run-fueling-station-gets-accused-of-socialism/

I think this makes sense as long as the costs to run it are fairly low. Supposedly gas stations earn their profits from the sale of extra things like candy and chips and not from the sale of gas. So the public station is not competing in that regard but is preventing gouging (which is more frequent here because it's a tourist area).

[Zambero]

1. Oh yes, socialism

And privately owned to boot. An oxymoron conjured up by actual morons. I'll wait to hear that this establishment will only cater to those patrons whose vehicles have gas caps on the left side.

[freebrew]

2. So, cutting one industry to promote another.

The retail suppliers need the extra income to stay open. Unless the station is owned by the oil company, making a go of it with a gas station isn't easy.

I tried it for a while at 20 cents 'profit' per gallon. You have to sell a LOT of fuel to be rich. Didn't work for me.
Stations around were higher, they did worse unless owned by the oil company.

Unless they can bypass the middle-man(wholesale supplier) they can't make much impact.

[A Little Weird]

3. I think the problem was with price gouging

The stations in the area were not selling at the market rate but were jacking their prices 20-30 cents higher. The public station is offering gas at the rate used everywhere else around there.

[d_r]

4. people come down from Ohio

pulling boats to take on the lake. so they buy gas for vehicles and boats. The interstate exit at Corbin as really cheap gas, cheapest exit in that stretch of 75. But once you get to somerset (a town off the interstate) it is a small town and has small town prices not interstate prices, so higher. The city is trying to push those prices down more because they want people to come there and spend money in the community instead of bakctracking to Corbin.