Senator Vulakovich Proposes Price Gouging Reforms

While efforts to prevent price gouging during an emergency are essential, the state’s guidelines for that process need fine tuning to ensure that they are specifically targeting that issue and are kept in place for an appropriate amount of time, according to Senator Randy Vulakovich, Chairman of the Senate Veterans Affairs & Emergency Preparedness Committee.

Senate Bill 1172 would modify Act 133 of 2006, the Pennsylvania Price Gouging Act, to ensure that a Governor’s emergency declaration does not place an undue and unnecessary burden on operations and businesses outside of and unrelated to the disaster.

Act 133 prohibits sellers from charging “unconscionably excessive” prices for all consumer goods and services when a state of disaster emergency is declared by the Governor. This prohibition is effective for the duration of the declaration (initially 90 days, but renewable) plus an additional 30 days after termination.

On Jan.10, 2018, Governor Wolf signed a disaster declaration to combat the heroin and opioid epidemic – the first such declaration for a non-natural disaster incident. The Governor has since extended that disaster declaration.

“Even though this was not a natural disaster, the declaration triggered the Price Gouging Act and all manufacturers, distributors and retailers statewide are subject to pricing restrictions for the next six months,” said Sen. Vulakovich. “This situation brings into sharp focus the need to amend the law so that its restraints on commerce apply only to the extent necessary.”

Senator Vulakovich said the lifespan 90 days or more for the restrictions is also an area that needs to be reviewed.

 “Three months plus an additional 30 days after termination is an excessively long period compared to other state laws and has resulted in situations where pricing restrictions from a disaster declaration for a winter snowstorm have remained in place until June or later,” Sen. Vulakovich said. “In fact, emergency declarations issued for winter storms in early March can remain in place and maintain price restrictions through the Fourth of July.”

Senator Vulakovich’s legislation would require a separate declaration from the emergency declaration to trigger pricing restrictions so they apply only when needed. It would also limit the duration of pricing restrictions to 15 days — with extensions up to 60 days — and limits the scope to only those goods and services necessary for use or consumption.

The measure is supported by the American Car Rental Association, Associated Petroleum Industries of Pennsylvania, National Federation of Independent Business, Pennsylvania Builders Association, Pennsylvania Chamber of Business and Industry, Pennsylvania Food Merchants Association, Pennsylvania Manufacturers Association, Pennsylvania Restaurant and Lodging Association, and the Pennsylvania Retailers Association.

Contact:         Nate Silcox (717) 787-6538