Coon Rapids council approves gas prepay ordinance

by Peter Bodley
Managing Editor

Coon Rapids has become the first city in Minnesota to require prepayment of gasoline at stations in the city.

Prepay gas pumps will be required at station in Coon Rapids effective Aug. 1.

On a 5-2 vote Tuesday evening, the Coon Rapids City Council adopted the prepay ordinance, which goes into effect Aug. 1.

Voting for the ordinance were Councilmembers Denise Klint, Melissa Larson, Paul Johnson, Bruce Sanders and Scott Schulte.

Opposed were Mayor Tim Howe and Councilmember Jerry Koch.

Prepayment can include paying by credit card at the pump or going inside and paying cash before the pump is turned on.

But the ordinance does have an exception to the prepay requirement offered by Sanders and amended by Schulte.

That states, “It is an exception… if business owners enter into a civil agreement with customers, pursuant to which customers may activate a fuel pump prior to payment.

“Such an agreement shall include identifying information of the customer that may be used by the business owner for seeking compensation if the appropriate civil court should the customer fail to pay for fuel after activating the pump.”

Police Chief Brad Wise, who proposed the prepay ordinance, calls the measure a crime prevention tool because of the spate of no pay/gas drive offs at Coon Rapids retail fuel businesses – 492 in 2010 and 481 in 2011, representing almost 20 percent of part one crimes reported in Coon Rapids, he said.

Responding to drive off reports has also been a drain on police resources and led to a spike in the city’s crime rate, Wise said.

“Officers responding to this number of gas thefts imposes a significant cost to our citizens, both in terms of time lost for officers to address other critical public safety needs, but also in terms of the negative impact such statistics have on our reputation as a safe place to live and work,” he said.

And Wise said that 15 percent of the gas thefts in 2011 were by people in vehicles with stolen license plates.

“The police department has reached out to retail fuel establishments since 2009 in an effort to reduce those thefts reported; however, no meaningful solution has been found.”

According to Wise, since the council began considering the prepay ordinance, the number of reported gas no pays has dropped significantly.

Prior to considering the ordinance for adoption Tuesday, the council had a work session Jan. 23 at which almost all gas station owners/operators spoke in opposition to the proposal, offered alternatives, including a civil process to deal with gas no pays and raised concerns about loss of business and higher costs in credit card fees they would have to pay.

The council was told that the jump in credit card use caused by a prepay ordinance would increase business costs because each time a credit card is used there is at least a 2 percent fee plus a transaction fee.

One gas station owner estimated that the increased credit card fees would cost him some $200,000 a year, a lot more than the loss through no pays.

In addition, bills have been introduced in both the Minnesota Senate and House to change the language of the drive-off law.

Instead of having to call police when there is a theft of gas incident, the clerk/cashier would note the make, model and license plate of vehicles at each pump before allowing the driver to pump gas.

Then if there is a no pay, the employee will certify and sign an affidavit and a notice of non-payment will be sent to the owner of the vehicle.

If the owner does not pay or respond within 30 days, then the police would be notified, as they would be in the event the license plates on the vehicle had been stolen.

The council was also told Jan. 23, that meetings have taken place involving a large number of the city’s gas station owners and operators to look at other ways of dealing with the no-pay issue, besides the legislation.

The discussion Tuesday evening was confined to the council, which debated the issue for an hour before taking a final vote.

According to Howe, the council has to weigh the public safety and crime rate reasons for the ordinance against the negative impact on the businesses through the increase in credit card fees and the loss of business from people choosing to go to gas stations in other cities where there is no prepay requirement.

He would prefer to table the ordinance to give the gas station owners/operators a chance to put their proposals into effect and to see if the proposed legislation becomes law, Howe said.

And he said the exception to the ordinance was a “terribly slippery slope.”

But Klint responded that it will be up the business to make a decision on exceptions to the prepay.

Koch was not interested in “cleaning up” the ordinance with the exception; he opposed the entire ordinance, he said.

He would support the ordinance if it was a “public safety panacea,” but he did not think it was and he did not feel threatened or unsafe without prepay, Koch said.

According to Johnson, the council has to act because of the high number of gas drive offs and the resulting strain on police resources.

He did not think the legislation would pass the House and Senate given the short time available and the other issues that are before the Legislature, Johnson said.

Koch did not see why the legislation would not pass with the bipartisan support it has and he wanted to give businesses a chance to find a solution to the drive-off issue, he said.

“They deserve more time,” Koch said.

And while Koch likes to see Coon Rapids be the first in the state, this is not one of those issues, he said.

But Klint said the police department has been trying for years to work with gas station owners/operators on the gas drive-off problem, but without any cooperation.

“Crime prevention is what we are trying to accomplish,” she said.

“We have to look at what’s best for our city, not worry about other cities.”

“Crime and public safety are what it’s all about.”

Larson agreed with Klint. “It’s still a crime whether it is dealt with civilly or not,” she said.

And Larson said she had a problem with tabling the ordinance because she did not think the gas station owners/operators came up with a viable solution in their presentations to the council Jan. 23.

When Schulte sold gas at his Hi-Ten Service Center business – he does not now – most of his customers prepaid and he thought that was common, he said.

And while he has heard the public sentiment opposed to prepay through phone calls and e-mails, he believes that gas no pays are a public safety problem that the council has to address, Schulte said.

And in other parts of the country where prepay has become law, gas stations have not lost business from people not going into the store after pumping gas, he said.

According to Sanders, given the number of drive-offs, the council “has to tighten things up and this is the way to go.”

What impacted Sanders was a real estate company website marketing a home in Coon Rapids, which showed a graph of the city’s crime rate and the impact that gas thefts have had on that, he said.

“Coon Rapids stuck out like a sore thumb,” Sanders said. “That was significant.”

Nothing in the ordinance precludes people from paying at the pump with their credit card as some people he has spoken with have suggested, he said.

“I’ve been paying at the pump for years,” Sanders said.

The ordinance before the council had a June 1 implementation date, but Howe asked that the date be pushed back to Aug. 1 to give gas station owners/operators time to get the needed equipment in place to comply with the ordinance.

“June 1 was no magic number for me,” said Schulte.

Under the adopted ordinance, any person or business establishment that violates any of the terms is guilty of a misdemeanor.

According to City Attorney Stoney Hiljus, there is technology available to gas stations that would allow customers to swipe a driver’s license, not necessarily a credit card, to activate the pump.

In his research on the issue, Hiljus came across the National Association of Convenience Stores website which states that a company, Pump-on LLC, has developed patented technology by which a cash customer can use their driver’s license at the pump, where basic identification information is read, to authorize pumping gas.

If customers fill up and fail to pay, their names are turned over to police, according to the National Association of Convenience Stores website.

This technology has been used by retailers in the country since 2007 and in Tulsa, Okla., and Kansas City gasoline theft has been cut to a trickle, the website states.

Peter Bodley is at [email protected]

  • Steve

    I live in CR and will now be buying my gas in other cities. I like to fill up my tank every time and with pre-pay that is impossible unless I use a credit card or debit which would cost me more for the gas. Huge mistake leaders! I give it 2 years.

  • Mike

    I agree with Steve, I fill up every time I get gas. When I go in I always get something else and pay for my gas. You can forget that now, I will be filling up in another town.

  • CR resident

    Steve what CR do you live in, I know of no gas station that charges more for using debt or credit cards. I see the same price at all my local stations in CR and no difference in price on how I pay. Furthermore, I don’t see any difference with payment mode in Anoka, Blaine or Andover and I drive those areas everyday.
    Just wondering????

    • Steve

      I live off of Hanson and 119th. And there is a Gas station located on that corner that actually gives you a discount if you pay with cash. And, I never said the gas stations charge me more for the transaction if I use credit or debit, I wrote that it costs me more either through the interest rate the credit card is charging, or the .30 cents my bank charges for each P.O.S. (point of sale) If the council thinks that everyone will be paying their credit card bills on time to minimize this they are out of touch. And as far as what other cities are doing, that’s neither here nor there… They are not pre-pay, I will be able to fill up, grab a coffee, and pay with cash.

    • carol

      I agree with you. I think he should change cards if this is the case. I have done a lot of traveling in other states were this is the norm. I have no problem with this

  • Tim

    Just cant keep your hands out of private business? Does there have to be a law governing everything we do right down to how we pay for our gas? What do we pay the police for? This is not a good thing for your community. At least you have 2 people on your council that have a good sense of what goverment should and shoud not be doing.

  • nmwtchdg

    Nothing has changed if you buy your gas from a gas station in Coon Rapids unless you intend to steal it. You can still use coupons, still pay afterward or before and with cash, check, debit card or credit card. it is simple…READ THE ORDINANCE before panicking and denouncing good work.

    • Spinner

      nmwtchdg, If this is such a good deal, tell me why the people that it is suppose to protect, which is the Station owners, against it?

      • nmwtchdg

        Not all are against the ordinance. The little guys want it and the big guys that want more market share via cannibalism are are not in favor of it…except in cities where they already have their market share. Profit to them is much more important than a safe community.

        • Steve

          “almost all gas station owners/operators spoke in opposition to the proposal, offered alternatives, including a civil process to deal with gas no pays and raised concerns about loss of business and higher costs in credit card fees they would have to pay.”

          This is not about protecting citizens, It’s about artificially lowering the crime rate by 20%, so the council and Chief of Police can puff out their chest’s and pad their resumes.

  • paul

    typical government action tackling a non problem. why don’t the police just come up with a different process? if the gas has been stolen and the thieves are gone, why not have the station file a report and be done with it. what are the police doing responding right away to the gas station anyway? dusting for prints? 481 times in a year is hardly worth costing businesses more in credit card charges let alone the losses from those who will by gas elsewhere.


  • Dave

    This should be great news for the people of Coon Rapids Their Police Department should be cut by 20 percent for part one crimes since the officers are now going to not have to respond to such big events. This city council needs other big issues to work on or they should be cut by 20 percent.

  • Miss Brenda

    Welcome to the ghetto. I pay with my debit card all the time. I hate it when people don’t pay and get away with it. I think CR is doing what most areas in not so nice neighborhoods do. There are many gas stations where you have to pay before you pump. Brooklyn Park has a lot of them, Washington Ave. in Minneapolis – try getting gas there for nothing and running off, swear those station manager’s will fire first and ask questions later.

    That’s the future and it is where we live boys and girls.

  • Jeremy

    Many of the people posting comments on here must really be out of touch with the reality of life outside of Coon Rapids. Truck stops require prepay usually, all stations in MPLS and St Paul-good luck getting the pump turned on without paying first. Even 10 years ago when I worked at an SA in Fridley we required prepay after dark. There is simply too much cost involved to go after a drive off and to prove theft of service. Yes prepay sucks but if you have a bank card then you don’t get charged for using it for purchases. And if you are charging the gas then thats your own economic decision to create debt. Bottom line, if the residents of the city home to the most apartments and town homes and red necks in MN don’t like having to prepay, too bad cause I’m sure the same people complaining are the same people who don’t pay and file taxes and are anti government too. Get real folks.

  • Lori

    Get Real Coon Rapids! I had my first experience with this new ordinance this morning. Not only was I forced to pay at the pump with my credit card, but when I went into the store to get a couple other items I had planned to pick up, I was lied to and generally treated like dirt. This will have an affect on your crime rate all right, but not in the way that the City Counsel is hoping it will. First of all, people who steal their gas will continue to do so. They are not going to stop stealing, they’ll just find other ways of getting what they want. You know, like identity theft and violence. They are very good at what they do, and they are not going to let a little thing like “pre-pay or pay at the pump” stop them. Also, I don’t think that gas drive offs are high priority calls for the police. On the other hand, armed robbery and muggings are.

    Of course most of the service station owners are against this. It’s going to be cutting into their profits. Has anybody taken a good look around when they go into a gas station? There are 95% “impulse buy” products inside and there is a lot of money being made on those items. If people don’t go into the store, they won’t be buying that stuff. Gas station owners stand to loose a lot more money from people not entering the store, and therefore not grabbing their snacks, beverages, candy etc… than they will be loosing on credit card charges from the banks.

    I was treated like a criminal this morning. Criminals don’t mind being treated like criminals, because that’s what they are, and they’re proud of it. But honest people do mind. This ordinance will be chasing your honest customers away. I was told that I could still use my gas coupons. All I have to to is bring my credit card into the store and leave it with them, and then go back out and pump my gas. I’m sorry, but it will be easier, and safer, to just go somewhere else. Most of us do watch the news and are not exactly comfortable leaving our credit cards with strangers while we are somewhere else. I don’t live in Coon Rapids and I won’t be buying my gas there any more either.

    Food for thought: If you treat your customers like criminals you are going to get criminals for customers. And remember, Minneapolis, St Paul, Brooklyn Center and Brooklyn Park were nice places to live, work and shop at one time. Not so much anymore.

  • CR resident

    Lori: FYI-prepay ordinance, which goes into effect Aug. 1. You were not effected by the ordinance, the gas station you were at (if in Coon Rapids) chose to do prepay. Furthermore I was at a Holiday Station on HWY 10 in Ramsey and it was prepay too, so does that make Ramsey a not so nice place to live?