For the past six years a gallon of gas at stations on the Maine Turnpike has cost about four cents more than it has off the road. And a pint of lemonade that gets 35 cents in town cost 50 cents at Howard Johnson's turnpike restaurant here.
A few state legislators who travel the four-lane highway to work at Augusta noticed the higher prices and their investigation has led to anti-trust suits against the Howard Johnson restaurant chain and Cities Service Company (CITGO). The companies operate at four interchanges along the state's only major north/south highway holding exclusive rights to sell food, drink and petroleum products. TR 1
The Main Attorney General's Consumer and Anti-trust Division says the two companies which hold monopolies at interchanges along the 100-mile road, have been overcharging for six years. The state estimates Howard Johnson's owes the public $3 million, while it estimates Cities Service reaped about $250,000 annually in extra profit.
Attorney's for the two firms would not comment on the suits.
The two cases are now before a judge at Kennebeck County Superior Court. Justice Herbert Silsby recently ruled that both suits fall under the state's unfair business practice laws, clearing a road for their progress through the state's courts.
Sheryl Harrington chief of the Consumer and Anti-trust Division says CITGO charged an average of four cents more per gallon of gasoline than other area stations. She also alleges that Howard Johnson's has overcharged for most of the items on its menu.
Both firms have signed agreements with the Maine Turnpike Authority guaranteeing their control of sales along the heavily traveled highway. The contracts require the vendors sell goods and services at prices comparable to what nearby off-highway businesses are asking. The highway carries most tourists who visit the Pine tree state. Tourism is the state's fifth largest industry.
State representative James Wilfong, of Stowe, says he became suspicious when he figured out that a glass of milk at HoJo's "works out to $5.65 a gallon." He adds that a look into the contracts granted by the Turnpike Authority "has left a lot of questions unanswered.
"For instance," Wilfong says, "why is it that Howard Hohnson's is always the company that gets these contracts? And why didn't the authority follow up on the contracts to make sure these companies weren't overcharging?"
Neither David Stevens, chairman of the Turnpike Authority nor representatives of the two companies would speak about the cases. However, Wilfong believes a profit-sharing system worked out with the Turnpike Authority "means money from the concesions is going to pay off construction bonds."
He adds, "We shouldn't have the highest priced hamburgers to retire highway construction bonds. We have tolls on the highway to do that." Wilfong says his own "hamburger survey" shows prices are higher on a limited access turnpike. "I don't see why we can't have a fast food chain like McDonald's or Burger King out there anyway," he says.
Maine Attorney General Joseph Brennan, also a Democratic candidate for governor, signed the suits against the companies. He alleges the firms "abused public monopolies by charging unreasonable, excessive and uncompetitive prices."
While Judge Silby's ruling takes the cases out of the class action category the state was seeking, attorney Harrington says if the state wins, consumers may still get some kind of payback.
"We will probably offer the courts three or four different schemes to force the companies to give the amount they overcharged back to consumers. They may include something such as providing free coffee and food at rest areas or radically reduce prices. The judge could choose one of our suggestions or develop another plan to give the money back."
But if there are free hamburgers and oil changes ahead for Maine Turnpike travelers, they're a long way down the road, adds Harrington, "A big case like this one," she says, "could take more than two years."