As part of a nationwide crackdown on illegally high gasoline prices, the U.S. Department of Energy has issued notices of "probable violation" to 11 Washington area service stations.
The notices allege that the stations are charging more than allowed under federal price controls, or have failed to place the required stickers on their pumps showing the maximum prices they can charge.
"I was over(priced) on one grade (so) I just rolled my premium back a penny," said Alexandria Shell dealer Michael L. Burstein one of the 11 here to receive a notice. "The little bureaucrats have to find something to do (so they) bother the hell out of the small businessman."
"Their allegations have got to be proven," said Edward Venit of Kenwood Shell, another dealer who received a notice. "I am not wrong."
Like many of the dealers involved, Venit said he has received conflicting information on how to apply DOE's enormously complex rules in calculating his maximum allowable prices.
"Someone (from the government) comes around and audits you and they interpret the rules different one minute from the next," said a Virginia Shell dealer who received a notice.
". . . All of them don't play the same ball game."
This dealer operates Belvoir Shell at 8540 Richmond Highway in Alexandreia and would identify himself only as Mr. Johnson. He said he operates three stations.
Most of the dealers who received notices here said they have had to raise prices in order to maintain profitability because their suppliers have curtailed the amount of gasoline they can sell.
The dealers must continue to meet many of their fixed costs in the face of the curtailments.
The curtailments are continuing nationwide despite resumption of Iranian oil exports and a general balance between world supply and demand for crude oil.
Alexandria Exxon dealer Dick Brilhart, who received a notice from DOE, said he didn't raise his prices significantly until mid-March, when his supply was cut roughly in half by Exxon.
This month, for example, Brilhart said he could sell 130,000 gallons but is allocated only 63,000.
After he raised prices, he said, Brilhart was "half a cent over (allowable ceiling price) on my regular gasoline. . . . But it's unfair . . . It's very easy for thumb on us . . .To me it's a case of constantly picking on us."
According to American Automobile Association figures, Washington area gasoline prices increased an average of 4.8 cents a gallon during the first quarter this year, an annual rate of more than 26 percent.
This was before the recent announcement of a new 9 percent price increase by the Organization of Petroleum Exporting Countries and before President Carter's Thursday announcement of the gradual lifting of price controls on domestic oil that will add to the cost of gasoline.
James Heizer of the Virginia Gaso- line Retailers Association said yesterday that Carter should have announced decontrol of gasoline prices at the pumps.
"It would be quite unfair to take controls off the producer and refiner levels without also removing gasoline retailers from the burden of controls," Heizer said.
He said that, "Few if any retailers are deliberately or willfully violating their ceiling prices . . . It's easy to make the gasoline retailer's a wipping boy."
Vic Rasheed of the Greater Washington Maryland Services Stations Association said, "There may have been some cases where there have been deliberate attempts (by dealers) to overcharge. That's not really the majority of the cases. . . . There's a great deal of confusion on how to calculate the maximum ceiling prices. It takes a bloody accountant to do it."
The 11 Washington area station to receive notices were targeted by DOE auditors after the agency received complaints from the public over telephone hotlines.
The local hotline number is 254-5474 for calls originating in the Washington area.Calls from elsewhere in the nation can be placed toll-free to (800) 424-9246.
Persons who think a station is overcharging or does not have the proper sticker showing maximum price on each pump may call these numbers and lodge a complaint.
Hundreds of complaints daily are pouring in over these hotlines, according to Bart Isenberg, assistant administrator for enforcement in DOE's Economic Regulatory Administration.
"Our biggest concern is to get as many stations as we can within legal limits," Isenberg said. "We are very concerned about willful violations, (dealers) who should know better.If we see a willful (violation) we will investigate it and very likely refer to the Department of Justice" for criminal prosecution.
Criminal charges against station owners can result in jail terms and fines of up to $10,000 per day per violation, Isenberg said. Civil penalties can result in fines of up to $2,500 per day per violation, he said.
None of the notices issued to the 11 stations have are criminal, Isenberg said. They are simply initial administrative allegations based on Doe audits to which the dealers must respond and which may or may not result in further action.
One dealer who received a notice, Ed Booth of Lorton Shell in Virginia, said his prices weren't over the allowable ceiling. He said he has simply failed to have the required stickers on his pumps.
DOE has only 15 or 20 auditors to cover more than 200,000 service stations in the nation. While Isenberg insists they are adequate to do the job, it appears that DOE is relying strongly on publicity and the hotline to keep prices at the stations under control.
The audits just began during the past few weeks as DOE beefed up its enforcement division. This was not required previously because nationwide curtailments from suppliers to stations did not begin until March. The widespread curtailments are what drove stations to begin raising prices rapidly. Isenberg said he is wary that DOE will be charged with being against small business. "We're trying to limit our response in a rational way and make sure that we're not overresponding," he said.
Isenberg admitted the complexity of the controls that govern each service station's prices on an individual basis. During an interview as he explained the rules to a reporter, Isenberg, an attorney, was uncertain on some points and had to consult written material as an aid.
Basically, a dealer's maximum price consists of what his supplier charges him, plus his profit margin per gallon as of May 15, 1973, plus state and federal taxes, plus allowances for rent and other overhead.
Dealer may also pass on costs from the past that they absorbed at the time rather than passing on immediately-but the computations involved in drawing on this so-called "bank" are so complex that relatively few dealers in the nation are thought to have business records sufficiently complete to claim and justify higher prices under this provision.
The area stations that received notices of "probable violation" from DOE are: Kenwood Shell, 5110 River Rd., Bethesda; Maryland Marina & Yacht Sales Inc., Middle River, Md.: Crouch's Texaco, 1911 Rockville Pike, Rockville; Woodmont Shell Service, 1250 W. Montgomery Ave., Rockville; Lorton Shell, 8015 Lorton Rd., Lorton; Burgundy Texaco, 5644 Telegraph Rd., Alexandria; Belvoir Shell, 8540 Richmond Highway, Alexandria; Groveton Shell, 6825 Richmond Highway Alexandria; Burgundy Exxon, 5640 Telegraph Rd., Alexandria; Burgundy Shell, 5630 Telegraph Rd., Alexandria; Hickman's Exxon, 200 N. Washington St., Rockville. CAPTION: Picture 1, Rising gas prices have brought hundreds of complaints to DOE from area residents. By James A. Parcell-The Washington Post; Picture 2, Self-service pumps offer motorists some relief from rising gasoline prices. By James A. Parcell-The Washington Post