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State Senator

Paul Doyle

Deputy Majority Leader

Representing Cromwell, Middletown, Newington, Rocky Hill & Wethersfield

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Contact: Mike VanSambeck
860-240-8820

March 8, 2011

Bi-Partisan Bill to Combat Price Gouging for Services—Including Flood Remediation and Snow Removal—Gets Public Hearing

Senate Majority Leader: “Our Experience This Winter Exposed Some Glaring Weaknesses in Our Price Gouging Statutes.”

Senate Majority Leader Martin Looney (D-New Haven / Hamden) testified in front of the General Assembly’s General Law Committee today in support of a bill he co-sponsored, Raised Bill 1089, which would ban price gouging for critical services during weather emergencies. The other sponsors of the bill are Senator Paul Doyle (D-Wethersfield), Senate Chair of the General Law Committee, and Senator Kevin Witkos (R-Canton).

Extreme weather this winter has created a great need for various weather related services. Ongoing flooding across Connecticut will require pumping of waterlogged basements. Record breaking snows of the past couple months caused several buildings to collapse, and required snow removal from residential and commercial roofs.

“It is no coincidence that this proposal comes at the tail end of the record-breaking winter of 2011, which exposed some glaring weaknesses in our price gouging statutes. The snow put great stress on roofs all across Connecticut. And now, as we head into spring, we are seeing ample flooding due to rain and melting snow.” said Senator Looney. “This all has led to what I believe is an alarming increase in Connecticut consumers’ vulnerability to price gouging, particularly for services. This bill will extend our state’s price gouging ban beyond the goods it covers now, and ensure consumers are protected for emergency weather services as well.”

“Severe weather conditions, whether torrential rains and flooding or multiple feet of snow, put a great deal of strain on homeowners and businesses. Once a major storm has passed, its aftereffects need to be addressed immediately. Water must be drained or snow cleared from creaking roofs,” said Senator Doyle. “Most contractors in Connecticut are honest and hardworking, but a small number may try to take advantage of people during severe weather, charging unconscionably high prices for essential and urgently needed services. This bill will outlaw that kind of exploitation.”

“Just as we finish digging out of the record breaking snow and paying down snow removal bills, we now face rain and flooding,” said Senator Witkos. “To ensure that homeowners and property owners are not subject to price gouging when seeking out emergency services to pump water or deal with flood damage, it is necessary for the state to step in and make certain no one in unfairly charged. Supporting this legislation creates an avenue to hold all companies accountable.”

“Making the law more clear will benefit consumers during difficult times. My office is ready to help enforce any new protections,” said Attorney General George Jepsen.

“I have heard of a wide range of prices quoted to homeowners for snow removal, and I am not at all surprised that price gouging has been going on,” said Ed Dypa, Middletown resident and Chair of Middletown’s Senior Services Commission. “There is a need for this problem to be addressed. Prompt, honest snow removal is a necessity. Heavy snow causes leaky roofs, which can result in water damage to ceilings and carpets, further increasing costs for seniors.”

A February 1, 2011 article in the Hartford Courant discussed a homeowner in Berlin who received a quote from a snow removal company for $3,650 to clear the roof of her 2,000 square foot home. When she demurred the contractor immediately lowered its quote by a thousand dollars. Others paid just a few hundred dollars for the same services.

Under current law, §42-230 of the Connecticut General Statutes prohibits an increase in the price of any good sold in an area under a formal disaster emergency declaration by the governor or President of the United States. §42-232 does apply to price gouging for some services, but only when the governor has resorted to the extreme declaration of a supply emergency or energy emergency, which also allows for rationing and carries potential criminal penalties.

The proposed legislation would extend the ban on price gouging to cover services as well as goods, and would also apply during, and potentially in the aftermath of, less extreme weather and other types of emergencies that do not necessarily result in a formal declaration by the governor or president.

Whether a price is “unconscionably excessive” would be determined in court, taking into account the common price of the relevant goods and services prior to the emergency, and the amount charged by other providers to consumers in the same area during that emergency.

The proposed bill is inspired by a similar law in the state of New York, which imposes a penalty of $10,000 for comparable price gouging during emergency conditions.

 

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