Case No. RR272-00125

March 1, 1999

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Motion for Reconsideration

Name of Petitioner: Gifford-Hill & Company, Inc.

Date of Filing: February 8, 1994

Case Number: RR272-125

This Decision and Order concerns a Motion for Reconsideration that Gifford-Hill & Company, Inc., filed on February 8, 1994. The subject of the Motion is a Letter issued to Gifford-Hill on May 20, 1993, which dismissed an Application for Refund (Case No. RF272-38282) that the firm filed in the crude oil refund proceeding being conducted by the Department of Energy. The Gifford-Hill refund request was dismissed because the Office of Hearings and Appeals (OHA) had requested supporting documentation on the volumes of products for which Gifford-Hill requested a refund, and we did not receive that information. This Decision grants the present Motion and approves a refund of $141,281.

In the prior proceeding, Gifford-Hill based its refund request upon purchase of 88,300,894 gallons of fuel oil, gasoline, diesel fuel, and motor oil. Because of the size of Gifford-Hill’s claim, we requested supporting documentation for the volumes of petroleum products claimed. The request for information stated that we could not fully consider the Gifford-Hill submission without the requested additional information. After a year had passed, and neither the requested material nor any other response to our requested was received, the Application for Refund was dismissed. Subsequently, Gifford-Hill submitted the requested information. Under the circumstances, we will review the Application for Refund.

In the past, purchasers of refined petroleum products were allowed to apply to the OHA for a refund from crude oil overcharge funds collected by the DOE from firms that sold crude oil during the price control period. Stated of Modified Restitutionary Policy To BeImplemented in Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986); 10 C.F.R. Part 205. The OHA has established refund procedures for these funds. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987); A. Tarricone, Inc., 15 DOE ¶ 85,495 (1987).

The refund procedures presume applicants were injured if they were end-users of petroleum products and not covered by the DOE’s or its predecessors’ price controls. City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987). Refund applicants are eligible to receive

a refund equal to the number of gallons purchased multiplied by $0.0016, the volumetric refund.

This presumption of injury is rebuttable. In an attempt to rebut the presumption, a group of States and Territories of the United States (States) filed an Objection opposing the Application of Gifford-Hill. The States contend in the Objection that Gifford-Hill suffered no injury because it could pass through most or all of the crude oil overcharges to its customers. The Objection is based on an economic analysis of business conditions during the price control period.

We have rejected similar objections many times in the past. The States have not shown that Gifford-Hill passed through a specific amount of crude oil overcharges, and we have previously determined that “a description of the general economic climate or an industry . . . is . . . insufficient to rebut the end-user presumption of injury.” Parker Drilling Co., 20 DOE ¶ 85,480, at 89,099 (1990); W.H. Johns, Inc., 18 DOE ¶ 85,574 (1989); see also In Re: The Department of Energy Stripper Well Exemption Litigation, 764 F. Supp. 1446 (1990) (Stripper Well Litigation). We therefore find the States’ Objection to be without merit.(1)

We have carefully reviewed the underlying Application filed by Gifford-Hill. Gifford-Hill is an end-user of refined petroleum products. Gifford-Hill claims, based upon Texas Diesel Users reports, production records, purchase orders, and consumption reports, that it purchased a total of 88,300,894 gallons of fuel oil, gasoline, diesel fuel, and motor oil. Gifford-Hill used these products in the production and sale of cement, ready-mix concrete, aggregates, concrete products, and concrete chemical admixtures. After considering the Application, we have concluded that the claimed volume is accurate and a refund of $141,281 is warranted ($0.0016 x 88,300,894 = $141,281). It is the policy of the DOE to pay all crude oil refund claims filed by June 30, 1994, the final deadline for the crude oil proceeding, 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 Gifford-Hill & Company, Inc., Case No. RR272-125, for all available crude oil overcharge funds is 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 $141,281 from the DOE deposit fund escrow account denominated Crude Tracking-Claimants 4, Account Number 999DOE010Z, maintained at the Department of Treasury. The check shall be made payable to “Gifford- Hill & Company, Inc., or William L. Walton & Associates, Inc.” and shall be sent to the following address:

William L. Walton & Associates, Inc.

10501 Wilshire Boulevard

Los Angeles, CA 90024

(3) To facilitate the payment of future refunds, the Applicants 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

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 materials submitted by the Applicants. Any of these determinations may be revoked or modified at any time upon a finding that the basis underlying any Application for Refund is incorrect.

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

George B. Breznay

Director

Office of Hearings and Appeals

Date: March 1, 1999

(1)The States also filed a Motion for Discovery with their Objection. Similarly, we have found that such general requests for discovery are not appropriate in the Subpart V proceeding where the States have presented insufficient evidence to rebut the presumption of end-user injury. Stripper Well Litigation, 764 F. Supp. at 1450; Copper Range Co., 18 DOE ¶ 85,431, at 88,692-93 (1988); Christian Haaland A/S, 17 DOE ¶ 85,439, at 88,464 (1988). The Motion for Discovery was dismissed as moot when the Application was dismissed. If the Motion were still pending, we would deny it in this proceeding.