Taxpayer Group Says 3-Month Delay for New Fuel Mandate Won't Stop 'Economic Meltdown'; Urges Assembly to Back State's Original Plan

4/1/2003

From: Al Cors, Jr., or Pete Sepp, 703-683-5700, both of the National Taxpayers Union

HARTFORD, Conn., April 1 -- The Connecticut Legislature's "compromise" bill to slightly delay implementation of fuel additive restrictions won't prevent a "pending economic disaster," according to the non-partisan National Taxpayers Union (NTU). The citizen group, which has 335,000 members nationwide and 5,500 members in Connecticut, today sent lawmakers an open letter urging them to enact instead the original proposal backed by the state's top environmental agency for a more reasonable phase-in that protects consumers and taxpayers.

"Unless the Legislature reverses course now, fuel price problems in Connecticut could turn into a full-blown crisis," said NTU Vice President for Government Affairs Al Cors, Jr.

In February NTU sent a letter to the leaders and members of the General Assembly's Environment Committee warning of "severe economic consequences for the taxpayers and citizens of Connecticut" if a ban on "MTBE," a fuel additive that reduces pollution from gasoline, takes effect on October 1.

NTU's research affiliate, National Taxpayers Union Foundation, commissioned a study of these consequences that was performed by the respected firm Energy Security Analysis, Inc. Based on the past experiences in other U.S. markets with fuel mandates, as well as the realities of the Northeast petroleum market, the study projected that price increases resulting from Connecticut's MTBE ban could reach 80 cents per gallon of gasoline during peak demand months, for a statewide total price increase of $550 million.

Cors noted that since the NTU study's release, conditions in the Middle East, along with Connecticut's neighbor, make it even more imperative that lawmakers heed the Department of Environmental Protection's warning that the current deadline for implementing the MTBE ban is "unworkable."

"Connecticut won't be ready with a mere 3-month extension of the deadline, and New York may well push back its ban date, leaving the state as a virtual island with the highest gas prices in the nation," Cors said. "Clearly more should be done to forestall this economic meltdown."

NTU is recommending that the Assembly pass the original version of Senate Bill 840, which would provide for a more deliberate and orderly transition to phase down the use of MTBE. At the very least, the Assembly could also implement a 15-month delay before the ban takes effect.

"Before the Legislature's Environment Committee amended it, Senate Bill 840 was a sensible solution to a potential price nightmare," Cors concluded. "The General Assembly should correct this mistake, by passing Senate Bill 840 in its original form."

NTU is a non-partisan citizen group founded in 1969 that works for lower taxes, less wasteful spending, and accountable government at all levels. Note: The 36-page study, Implications of a Connecticut and New York MTBE Ban, is available online at http://www.ntu.org.