Coon Rapids council repeals gas pre-pay ordinance

The controversial gas pre-pay ordinance was repealed by the Coon Rapids City Council last night (Tuesday, April 16).

The vote to repeal the law, which went into effect Aug. 1, 2012, mandating prepayment before pumping gasoline at all Coon Rapids gas stations, was 5-2.

cr logoMayor Tim Howe and Councilmembers Ron Manning, Jerry Koch, Bruce Sanders and Steve Wells were in favor; Councilmembers Denise Klint and Paul Johnson voted no.

The repeal ordinance won’t go into effect immediately, but rather on May 4. That will be 15 days after the ordinance is published in the city’s legal newspaper, the Coon Rapids Herald, in the Friday, April 19 edition.

When the repeal ordinance was introduced at the council’s April 2 meeting, there was a similar 5-2 vote and it was clear that no one had changed their mind on the council when discussion on the ordinance’s adoption took place last night (Tuesday).

Manning immediately moved its adoption, seconded by Koch, who had opposed the ordinance when it had been adopted by the council on a 5-2 vote early last year; Howe was also in opposition at that time.

Rather than repeal the ordinance, Johnson wanted to add two exceptions to the existing ordinance.

One would exempt gas stations from the pre-pay requirement if they had video surveillance cameras installed that allowed employees to note the model/license plate numbers of no-pay, drive-off vehicles and the other would allow gas station owners/operators to make specific arrangements with customers that would allow them to pump gas without prepaying.

Klint, too, was not ready to repeal the ordinance. “I feel like we are jumping the gun a little bit,” she said.

She still had concerns, including placing a burden on small stations that don’t have the technology available to identify drive-offs, according to Klint.

But Koch said that stations can still have a pre-pay requirement, but it will be their choice, not forced on them by the city.

“They can choose that business model,” he said.

Indeed, Koch said there were one or two stations in Coon Rapids that required pre-pay at the pumps prior to the council passing the ordinance.

According to Manning, the 40 percent recovery success rate for gas stations who pursue no pays through the civil process would pay for the technology in short order.

Sanders, who voted for the ordinance last year, said Johnson’s proposed exemption allowing gas station owners/operators to make arrangements with the customers was like the exception that the council attached to the original ordinance at his request.

But he said that has not worked that well. “The more exceptions you place on an ordinance, the less enforceable it is,” Sanders said.

The council should vote the repeal ordinance up or down and he will vote for it, he said.

According to Sanders, he voted for the original ordinance because of the impact of gas drive-offs on the city’s crime rate and it was good public policy.

But there has to be a balance with consideration given to the challenges it has imposed on the businesses affected, Sanders said.

In addition, a new state law requires gas station owners/operators to go after gas drive-off civilly to collect before the matter become a crime, he said.

“The crime rate has been reduced and best practices are in place,” Sanders said.

In Howe’s opinion, the council “jumped the gun” when it adopted the pre-pay gas ordinance last year.

At the time, efforts were under way with gas station owners/operators in the city to work out a solution to the gas drive-off problem, Howe said.

Not only did the pre-pay ordinance have a negative impact on sales at the gas stations in the city, it also gave a negative perception in the way people looked at the city, according to Howe.

He hoped that station owners/operators would continue to work with the police department on issues that might arise “to lessen the overall crime rate in the city,” Howe said.

Johnson said he had seen positive signs of the gas station owners/operators being willing to cooperate with the city since the process began, but it was “stonewalling” by some gas station owners/operators in the first place that prompted the police department to bring the ordinance to the council because of the increasing crime rate caused by gas drive-offs.

In an interview with the Herald before the council vote, Police Chief Brad Wise said that since the ordinance went into effect Aug. 1, 2012, there have been no gas drive-off incidents reported and from the time the ordinance was first proposed, the number of reports had dropped substantially because stations were not reporting the drive-offs.

The ordinance had been recommended by Wise as a “crime prevention measure” to counter the increasing number of no-pays/drive offs in Coon Rapids, which were causing a spike in the city’s crime rate.

In 2010 there were 492 gas drive-offs reported and in 2011, 481 were reported; that number was down to 44 in 2012, according to statistics that Wise presented to the council.

The new state law passed by the 2012 Minnesota Legislature will also have an impact with the repeal of the pre-pay ordinance, he said.

That requires the gas station owner/operator to attempt to collect a gas drive-off through the civil process and it does not become a crime until 30 days have passed and the issue has not been resolved, according to Wise.

In that event, the Coon Rapids Police Department will investigate the gas drive-off cases that are not resolved civilly, Wise said.

“It’s a matter of ethics,” he said.

However, some police departments have told gas station owners/operators that they will not investigate those reports and that’s why in some cities there are gas stations which have pre-pay requirements on all of their pumps, Wise said.

“We hope the downward trend in our crime rate will continue,” he said.

Speaking after the council vote, Lori Higgins, president of the MetroNorth Chamber of Commerce, who presented the case for many of the gas station owners/operators and the Minnesota Petroleum Marketers Association at the council’s March 20 work session on the ordinance, was happy with the decision.

At that March 20 meeting, Higgins had presented figures showing the loss of business sales, customer traffic and employee jobs/hours at the gas stations in town since the ordinance was enacted.

“The businesses can now start anew,” she said.

Rick Dehn of Dehn Oil, owner of the Marathon Station at Northdale and Foley boulevards, was relieved that the ordinance had been repealed, but he said it will take time to “win back the customers.”

And it will likely take advertising and promotions to restore the business that has been lost because of the ordinance, Dehn said.

Dehn has four pumps at his station and he did not have any pre-pay pumps before the ordinance. He said he did not see that happening now.

The losses he had from gas drive-offs were very small, Dehn said.

According to Brad Fogarty, representing the Kwik Trip at Coon Rapids Boulevard and Springbrook Drive, working with the MetroNorth Chamber of Commerce, other gas station owners/operators and the city had been positive, although the ordinance was not.

“We all learned from the process,” Fogarty said.

The Kwik Trip has eight gasoline dispensers and before the pre-pay ordinance, three of them, located farthest from the store, were pre-pay, he said.

Whether that policy will return once the repeal ordinance goes into effect has not been determined, Fogarty said.

But he said the civil process for dealing with gas drive-offs at other Kwik Trip stores had worked well.

The council action to repeal the ordinance may well have trumped what the Minnesota Legislature was proposing to do.

Bills are moving through the Legislature this session that would prohibit cities from unilaterally criminalizing or restricting the sale of “motor fuel based on the method of purchase agreed to by the seller and purchaser.”

Coon Rapids was the first city in the state, but not the first in the nation, to adopt a pre-pay gas ordinance and no other city in Minnesota gas followed suit.

The decision to revisit the ordinance at the March 20 work session was made by the council at a strategic planning project goal setting work session in January.

Since the initial 5-2 vote to enact the ordinance last year, there have been two changes on the council.

Melissa Larson and Scott Schulte, who both voted for the ordinance, left the council at the end of last year and their replacements, Manning in Ward 2 and Wells, at-large, both indicated during their 2012 election campaigns that they opposed the ordinance.

Peter Bodley is at [email protected]

  • EThan Campbell

    What a shame. The police chief gave the council an opportunity to lower the crime in this city, and the best part about it, was it was FREE! Didn’t cost a penny! And the oil companies ganged up and said “it was to inconvient!” Boo-Hoo! I had to pay for my gas inside just like everyone else, and it didn’t bother me a bit.

    • John

      Its not about Big Oil Companies, its about the freedom to choose. Not to be treated like a criminal. I quit buying gas in Coon Rapids when the ordinance was passed. We already have to much Government in are lives.

  • Rick

    It wasnt free. It cost the local retailers hundreds of thousands of dollars. They are tax paying, job creating, contributing members of the City of Coon Rapids and they deserve to receive the same services as everybody else. These are not big oil companies, they in many cases are small 1 and 2 convenience store small businesses, and they have all of the same difficulties as any other small business. Not to mention Cities shouldn’t be able to establish credit terms on the behalf of the small business that operate in their city.

  • flashpoint farley

    In 2011 one station was responsible for 23% of the drive offs. This has never been reported on: which station was it? Are they still in business? Did the ordinance affect their business? Did the city work with the owners before doing the ordinance ram job on the citizens and gas station customers?