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For Immediate Release
September 21, 2005
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Senate Passes White Bill to Fight Price Gouging

Businesses that exploit disasters would face up to $10,000 in penalties.

Harrisburg – Legislation sponsored by state Sen. Mary Jo White (R-21) to prevent price gouging during and immediately after a state of disaster emergency was approved today by the Senate.

"I am gratified by the bipartisan support this bill has received. I think the tragic events in the Gulf states have given the problem of price gouging more attention," said White. "We've been working on legislation to combat this problem for several years, and hopefully we'll be able to get this bill to the governor and signed into law." 

Senate Bill 450 would prohibit "unconscionably excessive" pricing during a declared state of disaster emergency and 30 days after. Drafted by White in cooperation with state Attorney General Tom Corbett, the measure gives the Attorney General the authority to investigate possible price gouging and imposes penalties on violators. 

A state of disaster emergency could be the result of a natural disaster, labor strike, act of terrorism, or other event, the senator noted. 

Under the measure, consumers who suspect price gouging could file a complaint with the Attorney General's Bureau of Consumer Protection. If an investigation verifies price gouging, the business would face civil penalties of up to $10,000. 

The senator originally drafted the legislation in response to price gouging reported in the wake of the Sept. 11, 2001 terrorist attacks, and sponsored similar legislation again in 2003. However, each legislative session ended before the General Assembly could act on the measure. 

Under Senate Bill 450, pricing would be considered "unconscionably excessive" if parties within the chain of distribution (manufacturers, suppliers, wholesalers, distributors or retailers) increase prices by 20 percent or more over the average price for the same goods or services obtainable in the affected area in the seven days prior to the state of emergency. 

The law would not apply to price increases caused by additional expenses -- such as replacement costs, taxes and transportation. 

"Disasters and emergencies usually bring out the best in citizens and businesses. We band together and help our neighbors. Unfortunately, there are exceptions, where such situations bring out the worst," said White.  "This legislation will allow us to identify those who are exploiting a crisis, and give the Attorney General the tools to go after them."