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Problem Solvers: Local Family Part of Probe Into Propane Price Gouging

Posted at 10:10 PM, Mar 20, 2014
and last updated 2014-03-21 11:23:27-04

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GALESBURG, Mich. (March 20, 2014) — A Kalamazoo County family is now officially part of the Michigan attorney general’s investigation and subpoena into propane price gouging involving the company called Ferrellgas or Best Propane.

According to the company’s website, Ferrellgas Partners, L.P. is an American supplier of propane with corporate operations in the Kansas City suburbs of Liberty, Mo., and Overland Park, Kansas.

They provide propane to families across the state and right here in West Michigan.

The family we talked to wanted to remain anonymous and said the attorney general’s office called them personally to alert them that the family’s experience was part of an investigation that has led to subpoenas issued to gain information from Ferrellgas.

The mother of two said received a January propane bill from Best Propane/Ferrellgas for more than $1,400. “The first thing we thought of, ‘How are we going to make ends meet?'” she said. “It was quite upsetting, being in the middle of winter, to get a bill for $1452.00 for propane.”

We broke down that bill and compared it to what they paid in December of 2013. At that time, their propane was priced at $2.33 a gallon. The family paid around $671 to fill their propane tank to 80%. Just about one month later, in January 2014, they were charged more than $5.00 a gallon for a total of $1,452.50 to return their thank to 80% full.

That’s a price jump of nearly $782 and a percentage increase of 116%.

“It was very sickening,” said the Galesburg mom.

Also of note on the family’s December bill, clearly printed documentation shows how the delivery driver calculated how many gallons were needed to fill the tank. Although the family was charged for the exact same amount of fuel in January, that section of that bill was blank. The family said the bill showed no proof of how much actually went into the tank.

“There was no information,” she said, “which led us to believe that there was something fishy going on.”

The couple contacted FOX 17 after seeing our report about another family’s struggle with propane prices.

“I, at that time, figured out that I wasn’t the only one, that there was something going on,” she said. This prompted her to take action, and she filed a complaint with the attorney general’s office the next day. Her claim was added to a petition that was filed in Saginaw County Wednesday.

And that family wasn’t the only one to complain.

Attorney General Bill Shuette’s office issued a release saying the office “has been contacted by more than 700 Michigan consumers since January” and has “received 65 complaints against Ferrellgas Inc. and its affiliate, Best Propane.”

“Ferrellgas denies there have been any violations of the Consumer Protection Act,” said Ferrellgas spokesperson Scott Brockelmeyer a statement. “The sudden wholesale price increases, supply constraints and logistics challenges faced by the propane industry this winter were unprecedented and were particularly severe in the state of Michigan.”

“As a result, propane providers had no choice but to pass those additional costs onto their customers,” he said.

However, the Kalamazoo County mom doesn’t put a lot of faith in that response. “I believe some of it was because of demand, but I don’t believe all of it was,” she said. “When we started calling around to other gas companies, we found that the price per gallon was at least $2 cheaper.”

The attorney general’s office said that they filed the petition in Saginaw County because a large percentage of the Ferrellgas complaints were from that county. However, the petition includes complaints from the company’s customers in other counties as well.

Since the judge signed the complaint, spokesperson Joy Yearout says Attorney General Bill Schuette and his staff can now start digging into Ferrellgas/Best Propane records. They are also allowed to interview employees. She said there could be subpoenas issued for other companies as well, since there were around 700 complaints total that the office has received so far.

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