Case No. RF272-98707

May 14, 1997

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Applications for Refund

Names of Petitioners: Hershey Entertainment & Resort Co. et al.

Date of Filings: July 5, 1994

Case Numbers: RF272-98707 et al.

This Decision and Order will consider the Applications for Refund filed by five claimants that purchased refined petroleum products during the period August 19, 1973, through January 27, 1981 (the crude oil price control period). Each applicant has requested a refund from crude oil monies available for disbursement by the Office of Hearings and Appeals of the Department of Energy under 10 C.F.R. Part 205, Subpart V. We have established refund procedures for these funds, which have been made available through consent orders entered into by the DOE and numerous firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987) (Berry); A. Tarricone, Inc., 15 DOE ¶ 85,495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986).

In order to receive a refund for crude oil overcharges, an applicant generally must: (1) document its purchase volumes; and (2) show that it was injured as a result of the alleged overcharges. However, as we discussed in City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987), applicants who were end-users of petroleum products and whose businesses were unrelated to the petroleum industry are presumed to have absorbed the crude oil overcharges, and generally need not submit proof of injury to receive a refund in the Subpart V proceeding. See also Berry.

In general, a claimant is eligible for a refund equal to the number of gallons it purchased multiplied by $0.0016 per gallon, the volumetric refund amount currently available. We derived the volumetric refund amount by dividing the total crude oil refund monies currently available by the total U.S. consumption of petroleum products during the period of crude oil price controls (2,020,997,335,000 gallons).

Each of the applicants considered in this Decision and Order is an end-user. Each bought petroleum products to operate its business. Each applicant has derived its purchase volume claim by using

actual records or a reasonable estimation technique. We have carefully reviewed the information submitted by the applicants, and have determined that the information provided by three of the applicants sufficiently supports their requests for refunds.(1)

However, in two cases we have reduced the applicants’ volume claims. In the case of Tarrant County (Tarrant), Case No. RF272- 98757, the county applied for a refund based on estimated purchases of 12,255,005 gallons of covered petroleum products from Gulf Oil Corporation (Gulf) and 807,669 gallons of non-Gulf purchases. However, Tarrant’s purchase volume printout from Gulf showed purchases totaling only 4,782,318 gallons. Tarrant’s representative, Wilson, Keller & Associates (WKA), extrapolated that figure for the period after the July 1, 1976 decontrol date for diesel fuel, because it alleged Tarrant purchased only diesel fuel from Gulf. In attempting to verify this assertion, we discovered on a more detailed Gulf customer listing that contrary to WKA’s claim, Tarrant did not purchase any diesel fuel from Gulf. We have therefore reduced Tarrant’s gallonage claim accordingly.(2)

Had this Office accepted WKA’s assertion that Tarrant purchased diesel fuel from Gulf, this would have resulted in an additional $11,956 erroneously granted to Tarrant. There is no indication anywhere in the case file that WKA attempted to confirm this assertion with Tarrant, this Office or any other source. Further, WKA’s assumption that Tarrant purchased only diesel fuel and did not purchase any other types of products is contrary to common sense. In fact, as indicated above, Tarrant purchased no diesel fuel at all from Gulf.

It is one of the primary responsibilities of filing services such as WKA to insure that they have provided accurate information concerning the claimants they represent. We rely on the veracity of their assertions about the purchases made by those claimants. It is because we believe that a filing service is trustworthy that we are willing to mail refund checks to the service on behalf of refund recipients.

Due to the incorrect assertion by WKA concerning the type of product purchased by Tarrant, we have lost some of our confidence in the ability of the firm to fulfill its obligations scrupulously. We see here a rather disquieting willingness to make statements that are expedient, rather than accurate.

In prior instances in which we have lost confidence in a filing service’s truthfulness, we have disqualified it from representing clients before the OHA. See Energy Refunds, Inc., 23 DOE ¶ 85,076 (1993); Ken’s Professional Waterproofing, 18 DOE ¶ 85,771 (1989). We do not believe this measure is warranted here. However, in this particular case, instead of following our normal procedure of sending Tarrant’s refund check to WKA for ultimate disbursement to that applicant, we will direct the Controller of the DOE to mail the refund check directly to Tarrant. See Wales Transportation, Inc., 26 DOE ¶ 85,036 (1997), reconsideration denied, 26 DOE ¶ 85,042 (1997).

We have also reduced the claimed gallonage of another applicant, the Roman Catholic Diocese of Paterson (the Diocese), Case No. RF272-98796, which applied on behalf of a number of different parishes and schools. The Diocese applied for a refund based on purchases of 13,572,297 gallons. However, some of the parishes and schools whose purchases are included in its claim have already been granted crude oil refunds, and therefore those volumes were subtracted from the Diocese’s volume claim. These parishes which have already been granted refunds are listed in the following table:

Case No.

Case Name

Approved gallons

RF272-77643

St. John Cathedral

288,000

RF272-77736

St. Mary’s

156,000

RF272-77768

St. Peter’s Church

95,200

RF272-77800

Morris Catholic High School

296,600

RF272-77867

St. Paul’s Catholic Church

292,100

RF272-77889

St. Brendan Parish

203,800

RF272-89777

Our Lady Queen of Peace

204,796

RF272-90185

Holy Spirit Church

88,724

RF272-90264

St. Mary’s Church

129,705

RF272-90471

Our Lady of the Mountain

49,728

RF272-90504

St. Anthony’s Church

150,000

RF272-92571

Immaculate Conception Church

89,409

Total:

2,101,062

Accordingly, the Diocese’s approved volume claim is 11,471,235 gallons.(3)

Since the applicants listed in the two Appendices to this Decision are end-users of refined petroleum products, they are presumed injured by the crude oil overcharges and are entitled to receive their full allocable share of the crude oil monies. The refund amounts are calculated by multiplying the approved purchase volumes by the volumetric refund amount of $0.0016 per gallon. The purchase volumes and refunds approved for each applicant are set forth in the Appendices. The total volume for which refunds are approved in this Decision is 18,931,722 gallons, and the sum of the refunds granted is $30,291.

Four of the applicants filed their Applications through WKA and each requested that their refund checks be sent to that firm. However, as explained above, we will honor only three of those applicants' requests. For those three applicants, their refund checks will be made payable to the applicants “or Wilson, Keller & Associates” and be sent to WKA. The other two applicants will have their checks sent to them directly.

The final deadline for the crude oil refund proceeding was June 30, 1995. It is the current policy of the DOE to pay crude oil refund claimants at the current rate of $0.0016 per gallon. We will decide whether sufficient crude oil overcharge funds are available for additional refunds for these and other successful applicants when we are better able to determine how much additional money will be collected from firms that have either outstanding obligations to the DOE or enforcement cases currently in litigation.

It Is Therefore Ordered That:

(1) The Applications for Refund filed by the five claimants listed in the Appendices attached to this Decision and Order for all available crude oil overcharge funds are hereby approved as set forth in Paragraph (2) below.

(2) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller, of the Department of Energy shall take appropriate action to disburse from the escrow account maintained at the Department of the Treasury denominated Crude Tracking- Claimants IV, Account No. 999DOE010Z, the amounts specified in Appendices 1 and 2 to this Decision and Order to the applicants specified in those Appendices. The refund checks for the applicants listed in Appendix 1 should be sent to Wilson, Keller & Associates, P.O. Box 221135, Memphis, TN 38122. The refund check for the applicants listed in Appendix 2 should be sent to those applicants.

(3) To facilitate the payment of future refunds, each applicant shall notify the Office of Hearings and Appeals in the event that there is a change in its address, or if an address correction is necessary. Such notification shall be sent to:

Director of Management Information

Office of Hearings and Appeals

Department of Energy

1000 Independence Avenue, S.W.

Washington, D.C. 20585-0107

(4) The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary material submitted by the applicants. This Decision and Order may be revoked or modified at any time upon a determination that the basis underlying a refund application is incorrect.

(5) This is a final Order of the Department of Energy.

George B. Breznay

Director

Office of Hearings and Appeals

Date: May 14, 1997

(1)One applicant, Snokist Growers, Case No. RF272-97861, was previously granted a refund in this proceeding under Case No. RF272-00714. In the earlier application, the applicant’s claim was based purely on purchases from Yakima Oil Company and Petrolane Gas Service. In the application at issue in this proceeding, the applicant has used records indicating its purchases from Atlantic Richfield Company. The applicant has satisfactorily proven that it purchased the additional petroleum products for which it is awarded a refund in this case.

(2)In addition, we believe the Gulf printout submitted by Tarrant includes all of Tarrant’s 1973 purchase volume, and accordingly, must be reduced to account for the beginning of the crude oil refund period, August 1973. See, e.g., Carolina Dairies Corp. et al., Case No. RF272-97820 et al. (July 23, 1996). Therefore, we further reduced Tarrant’ volumes by approximately eight and one half months of 1973 Gulf purchases. The total approved purchase volume for Tarrant is 5,303,078 gallons.

(3)In addition, there are five other applicants who have received refunds in this proceeding and who are also affiliated with the Diocese. The Diocese has not applied for refunds on behalf of these applicants. These five applicants are listed in the table below:

Case No.

Case Name

RF272-10646

St. Mary’s Hospital

RF272-12110

St. Joseph’s Hospital and Medical Center

RF272-77784

St. John Kanty R.C. Church

RF272-77873

St. Philip the Apostle Church

RF272-77886

Paul VI Reg. High School

Appendix
CASE NO. APPLICANT FIRM CONTACT VOLUME REFUND  
RF272-98707 HERSHEY ENTERTAINMENT & RESORT OR WILSON, KELLER & ASSOCIATES C/O FRED BEKENROD 1,144,487 $1,831  
RF272-98715 FLAMENCO AIRWAYS, INC. OR WILSON, KELLER & ASSOCIATES C/O NOEMI GONZALEZ 460,393 $737  
RF272-98761 SNOKIST GROWERS OR WILSON, KELLER & ASSOCIATES C/O ROB GALLION 552,529 $884  
Totals: 3     2,157,409 $3,452  
             
             
CASE NO. APPLICANT CONTACT STREET ADDRESS CITY/STATE VOLUME REFUND
RF272-98757 TARRANT COUNTY C/O JUDGE TOM VANDERGRIFF 100 E. WEATHERFORD ST. FT. WORTH, TX 76196 5,303,078 $8,485
RF272-98796 R.C. DIOCESE OF PATERSON C/O JOYCE LARSON 777 VALLEY RD. CLIFTON, NJ 07013 11,471,235 $18,354
Totals: 2       16,774,313 $26,839
             


Last Updated on 7/10/97
By OHA