Are Propane Firms In Connecticut Playing Fair On Taxes?

This column is part of a continuing series shedding light on the least transparent energy industry in the country: propane gas. Full Story
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CHRISTINE

Glastonbury, CT

#21 Jan 27, 2009
DJH wrote:
<quoted text>
That wouldn't have happened, if propane companies didn't "lock down" homeowners, would it? Do you propane dealers honestly expect to hold monopoly power over people's propane tanks and have them just capitulate to you automatically?
I note you don't defend the practice of not reporting the presence of tanks to assessors or paying property taxes on them, which is the subject of this article. Hmm. Are we trying to dodge the issue?
As far as propane companies holding monopoly, you have every right to purchase your tank outright with blocks and regulators, so if you have the funds available to do so you would then get a customer owned rate. You then have full liability of the asset.

DJH

“Thinking critically since 1964”

Since: Mar 07

Winsted, CT

#22 Jan 27, 2009
CHRISTINE wrote:
<quoted text> As far as propane companies holding monopoly, you have every right to purchase your tank outright with blocks and regulators, so if you have the funds available to do so you would then get a customer owned rate. You then have full liability of the asset.
You say that, but this is a hollow promise: You said consumers cannot do the hookups safely. If propane companies will only hook up their own tanks, who will do it?

Answer: No one. That's what makes yours a hollow promise.

As for the liability ... while the propane companies may have liability for tanks they own, who pays for that? The consumers who foot the bill for them. For the consumer, it's a wash.

Since: Jan 09

Tecumseh, MI

#23 Jan 27, 2009
The practice of assessing personal property tax on propane tanks is double taxation. Here's why -
Property assessors typically place the same value on:
properties with a propane heating system (where tanks are owned by a company) and
properties with an oil heating system (where tanks are owned by homeowner).

Why is this the case? If propane tanks are taxed separately, propane homes should be assessed at a lower value than heating oil homes. If not, why not?
Ted K

Berlin, CT

#24 Jan 28, 2009
arctic1075 wrote:
The practice of assessing personal property tax on propane tanks is double taxation. Here's why -
Property assessors typically place the same value on:
properties with a propane heating system (where tanks are owned by a company) and
properties with an oil heating system (where tanks are owned by homeowner).
Why is this the case? If propane tanks are taxed separately, propane homes should be assessed at a lower value than heating oil homes. If not, why not?
Excellent point, if a fuel tank in included in a homeowners taxes and is owned by Bemers then Bemer owes the homeowner a rebate for taxes charged since they are charging taxes on the tank as well. This definately rings of tax fraud, the AG should be involved in this question.
CHRISTINE

Glastonbury, CT

#25 Jan 28, 2009
DJH wrote:
<quoted text>
You say that, but this is a hollow promise: You said consumers cannot do the hookups safely. If propane companies will only hook up their own tanks, who will do it?
Answer: No one. That's what makes yours a hollow promise.
As for the liability ... while the propane companies may have liability for tanks they own, who pays for that? The consumers who foot the bill for them. For the consumer, it's a wash.
Any person with a G1 or S1 license is certified in the hook-up of propane equipment i.e. plumbers, subcontractors. The liability is absorbed by the owner of the equipment and this is why customer owned tanks have a lower rate per gallon. When a company owns your tank, they pay for the taxes, insurance, maintenance and if you are on a auto delivery and they fail to deliver which results in your home freezing up, it's their insurance who pays, not yours. People need to educate themselves as to what is in their home and what option would best suit them. A person leasing a tank and using 24 gallons per year will pay a much higher rate to recover the expense paid up front by the provider on company owned equipment. The more you use the lower the rate. Most people think that you stick a pipe in the ground and get propane. Not true, propane is a by-product of natural gas, crude oil and other gases. The pricing of propane along with being based on usage is subject to component pricing also.
DJH

United States

#27 Jan 28, 2009
CHRISTINE wrote:
Any person with a G1 or S1 license is certified in the hook-up of propane equipment i.e. plumbers, subcontractors.
This may be true, but what folks have reported on the Watchdog site is that propane companies will not touch tanks that are not their own. This means homeowners cannot purchase their own tanks because their propane companies will not connect them. For that matter, even if someone could get one connected, lots of companies won't even FILL one that's not their own.

If this is the case, it means the promise that homeowners can buy their own tanks and have their propane company connect and fill them, is empty, since effectively it cannot be done.
CHRISTINE

Oxford, CT

#28 Jan 28, 2009
DJH wrote:
<quoted text>
This may be true, but what folks have reported on the Watchdog site is that propane companies will not touch tanks that are not their own. This means homeowners cannot purchase their own tanks because their propane companies will not connect them. For that matter, even if someone could get one connected, lots of companies won't even FILL one that's not their own.
If this is the case, it means the promise that homeowners can buy their own tanks and have their propane company connect and fill them, is empty, since effectively it cannot be done.
I feel you have been misinformed. A propane company cannot by law fill another companies tank due to the liability. If you own your own tank and have proof of ownership, any company you choose can fill it. Some may require a safety inspection of the appliances and tank before filling it for liability reasons, to make sure your system is up to current codes and is operating safely. If you purchase a new tank from a propane company they may require that they connect it and give you your 1st fill. If you plan on purchasing your own tank, never sign a contract no matter how good it sounds. This is defeating the purpose of buying it in the first place.
CHRISTINE

Oxford, CT

#29 Jan 28, 2009
DJH wrote:
<quoted text>
This may be true, but what folks have reported on the Watchdog site is that propane companies will not touch tanks that are not their own. This means homeowners cannot purchase their own tanks because their propane companies will not connect them. For that matter, even if someone could get one connected, lots of companies won't even FILL one that's not their own.
If this is the case, it means the promise that homeowners can buy their own tanks and have their propane company connect and fill them, is empty, since effectively it cannot be done.
I feel you have been misinformed. A propane company cannot by law fill another company's tank due to insurance liability. If you own your own tank you can have any one you choose fill it. You may need to provide proof of ownership and the company you choose may opt to perform a safety inspection of the appliances and the tank for liability reasons and to ensure everything is up to current code and most importantly operating safely. The company you purchase the tank from may require that they do the initial connections and installation and also 1st fill. Never sign a contract with anyone when you own your equipment no matter how good it sounds. This defeats the purpose of purchasing it in the first place.

Since: Jan 09

Tecumseh, MI

#30 Jan 28, 2009
Ted K wrote:
<quoted text> Excellent point, if a fuel tank in included in a homeowners taxes and is owned by Bemers then Bemer owes the homeowner a rebate for taxes charged since they are charging taxes on the tank as well. This definately rings of tax fraud, the AG should be involved in this question.
My is that the propane company is paying Personal Property Tax (PPT) and the homeowners are paying Real Property Tax on the same tanks. That's double taxation and wrong.

If a propane company is charging you outright for a PPT reimbursement, and they haven't actually paid the tax, that's wrong. But if they've paid the PPT, you can't blame them for passing on it to the customer.
PAK

Norwich, CT

#31 Jan 29, 2009
GEO wrote:
<quoted text>
Then they will complain about the price. Well then they can thank the whisle blower for their increased heating costs. A tank is a tank not property. boy the govt is going to start taxing the air soon. weight x days breathing @2%=
Actually we were told by our tax assessor that if you own your own tank, you don't pay taxes on it. It's part of owning a home and doesn't cost anything more. And, it's covered by homeowners insurance too.
Ted K

Moodus, CT

#32 Jan 29, 2009
arctic1075 wrote:
<quoted text>
My is that the propane company is paying Personal Property Tax (PPT) and the homeowners are paying Real Property Tax on the same tanks. That's double taxation and wrong.
If a propane company is charging you outright for a PPT reimbursement, and they haven't actually paid the tax, that's wrong. But if they've paid the PPT, you can't blame them for passing on it to the customer.
How about his scenario, Bemers puts in one tank for each 2 or 3 houses, they meter each home and the homeowner pays for the gas used from this tank, the homeowner does not own the tank or the gas stored in it, they pay for the amount of gas used, who would be responsible for the tax on the tank and on the gas inside it? This should bring some nuts from the gas people.
A Hartford Native

Wolcott, CT

#33 Jan 31, 2009
This has been going on for years. Fifteen years ago I called to complain to the Atty. General's office, and was told it was a free market system, and that I was free to buy from whomever I wanted. Because when you do call qround as a new customer you're given a great price. Change over, and within a year the price i right up there again.
And you're basically looked in because they own the tank, etc.

My question is, why hasn't the A.G.'s office taken a closer look at this, and why aren't these people regulated thru the DPUC?

Also, I've noticed that on some on the postings someone has called alot of the complaints spam, someones honest opinion while on topic is not spam. Could there be a propane dealer out there who's not happy with all this publicity?
John

Newington, CT

#34 Feb 6, 2009
A Hartford Native wrote:
My question is, why hasn't the A.G.'s office taken a closer look at this, and why aren't these people regulated thru the DPUC?
LOL, the DPUC is just like the Better Business Bureau. Don't count on the DPUC to EVER DO ONE THING THAT BENEFITS THE CONSUMER. They are in BED with all the utility companies.
Ray

Amherst, MA

#35 Feb 10, 2009
Here in Western Mass, the propane companies own many of the in ground tanks in the yard (like a lease) and only the owner of the tank will fill it. Like people above have said, no other company will touch the tank. This would be fine if we were being treated fairly by our LP supplier. This is not the case.

We are forced to go with a company that charges us >70c per gallon more than the open market. No other companies will fill this in ground tank and we are trapped. They will only fill their own or customer-owned tanks. We use > 1000 gallons per year, so do the math. I looked last week and the open market price for LP was $2.35, company XX was charging their customers $2.49, our company, EO Osterman, is charging us $3.03!!!

If you did not build your own house, you may be surprised to learn (as we were) that you do not own your propane tank and may be forced to deal with a single supplier. I didn't realize the implication of having this tank, but now that I see I am paying significantly more than market price and have no choice of supplier I am thinking about converting from LP to oil to get out of this price fix.

I would love to hear how the tax evasion argument holds up in CT. Maybe we can apply this logic here.
Fred

AOL

#37 Apr 27, 2009
This is one very good set of reasons to find a good oil burner technician and a good oil supplier, (not always the same one) and take advantage of a real free market. Too many folks are switching to propane as a knee jerk reaction to last years unusual spike. Countless folks have discarded good oil equipment by considering prices per gallon without realizing that propane has only about 2/3 the heat value per gallon. Some are angry at oil suppliers because of the spike, but they are only the retailers of the product and had no control over the price while their delivery costs and debt service costs went through the roof.Oil suppliers could hardly be accused of the business practices described here.

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