March 21, 1997
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
Motion for Reconsideration
Name of Applicant: S.C. Johnson & Son, Inc.
Date of Filing: July 13, 1994
Case Number: RR272-00150
On May 3, 1991, the Office of Hearings and Appeals (OHA) of the Department of Energy dismissed the Application for Refund submitted by S.C. Johnson & Son, Inc.(Johnson), Case No. RF272-70908. We dismissed Johnsons Application because Johnson failed to provide information that we requested about the products for which it was claiming a refund. This Decision and Order considers Johnsons Motion for Reconsideration, in which it provides the requested information. As explained below, we will grant the Motion.
In its original Application, Johnson requested a refund based on purchases of certain refined petroleum products it made during the crude oil refund period.(1) The monies for these refunds are available for disbursement by the OHA pursuant to 10 C.F.R. Part 205, Subpart V.
In the past, purchasers of refined petroleum products during the crude oil price control period could apply for a refund from crude oil overcharge funds. 51 Fed. Reg. 27899 (August 4, 1986). The Department of Energy collected the crude oil overcharge funds through consent orders with certain firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987); A. Tarricone, Inc., 15 DOE ¶ 85,495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986).
The refund procedures specify that, to receive a refund, an applicant generally must: (1) document its purchase volumes; and
(2) show that it was injured by alleged crude oil overcharges. An applicant who was an end-user (ultimate consumer) of petroleum products, whose business was unrelated to the petroleum industry, and who was not subject to the price regulations of the DOE or its predecessors, is presumed to have absorbed rather than passed on alleged crude oil overcharges, and is therefore presumed to have been injured. 52 Fed. Reg. 11737 at 11743 (April 10, 1987).
The procedures also specify that we will consider granting a refund in this proceeding for the purchase of products that were: (a) designated as covered products in regulations promulgated pursuant to the Emergency Petroleum Allocation Act (EPAA) of 1973, 15 U.S.C. §§ 751-760; (b) purchased from a crude oil refinery; or (c) originated in a crude oil refinery and purchased from a reseller who did not substantially change the products' form. 57 Fed. Reg. 30731 (July 10, 1992).
We have carefully reviewed the information submitted by Johnson in its Motion for Reconsideration, and we find that the information it provided sufficiently supports its refund claim.(2)Johnsons claim is based on its purchases of solvents (under trade names such as Shell Sol 130B and Exxon Low Odor Paraffin Solvent), n-pentane, and hydrocarbon propellants (a mixture of n-butane or isobutane and propane). Both butane and propane were specified as covered products under the EPAA. In addition, data supplied by Johnson show that the products claimed as solvents and n-pentane fall within the definition of special naphtha solvents in the EPAA. 40 Fed. Reg. 2795 (January 16, 1975). Thus, the products claimed by Johnson form a valid basis for a refund in this proceeding.
To support the amount of its gallonage claim, Johnson has submitted copies of invoices from the refund period from companies such as Shell Oil Company and Exxon Chemical Company. Based on this documentation, we find that Johnsons gallonage claim of 71,117,165 is reasonable.
Johnson used the petroleum products that it purchased to manufacture various household cleaning products such as furniture polish, wax, disinfectants and stain removers. We therefore find that Johnson was an end-user of refined petroleum products. As an end-user, Johnson is presumed injured by the crude oil overcharges and is entitled to receive its full allocable shares of the crude oil overcharge funds. We calculate the refund amount by multiplying the applicant's approved gallonage claim by the current volumetric refund amount of $.0016 per gallon. Johnson's approved purchase volume is 71,013,841 gallons of refined petroleum product. The total refund that we will grant Johnson is therefore $113,622.
The final deadline for the crude oil refund proceeding was June 30, 1995. It is the current policy of the DOE to pay eligible crude oil refund recipients at the 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 Motion for Reconsideration filed by S.C. Johnson & Son, Inc. (Case No. RR272-00150) is hereby granted 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 the indicated refund amount from the DOE deposit fund escrow account denominated Crude Tracking- Claimants 4, Account Number 999DOE010Z, maintained at the Department of Treasury. A refund check in the amount of $113,622 shall be issued to:
S.C. Johnson & Son, Inc.
OR William L. Walton & Associates, Inc.
10501 Wilshire Blvd.
Los Angeles, CA 90024
(3) To facilitate the payment of future refunds, S.C. Johnson & Son, Inc., shall notify the Office of Hearings and Appeals in the event that there is a change of 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 determination made in this Decision and Order is based upon the presumed validity of the statements and documentary materials submitted by S.C. Johnson & Son, Inc. This determination may be revoked or modified at any time upon a finding that the basis underlying the Motion for Reconsideration is incorrect.
(5) This is a final Order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: March 21, 1997
(1)The crude oil price control period extended from August 19, 1973 through January 27, 1981.
(2) Interested parties were given an opportunity to submit comments regarding individual crude oil refund applications. A group of States and Territories (the States) filed a consolidated Objection to Johnson's original Application for Refund. We dismissed the Objection when we dismissed Johnsons Application, and the States did not file an Objection to this Motion. The Objection argued that, although Johnson was an end-user, it was in fact able to pass through to some extent the alleged crude oil overcharges. We have on numerous occasions rejected similar arguments from the States. E.g., El Paso Sand Products, Inc., 22 DOE ¶ 85,173 (1992).