Case No. RR272-00191

December 16, 1997

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Motions for Reconsideration

Name of Petitioners:Lisbon Schools

Durham Schools

Date of Filings: March 3, 1995

Case Numbers: RR272-191

RR272-192

This Decision and Order will consider Motions for Reconsideration filed by Lisbon Schools and Durham Schools with the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE). Each school system asks OHA to reconsider its January 17, 1995 dismissal of its respective Applications for Refund (Case Nos. RF272-79965, RF272-79966), and to grant its refund applications, as supplemented.

I. Background

Pursuant to DOE policy, purchasers of refined petroleum products were permitted to apply to the OHA, until June 30, 1995, for a refund from crude oil overcharge funds collected by the DOE. Statement of Modified Restitutionary Policy to be Implemented in Crude Oil Cases, 51 Fed. Reg. 27899 (August 4, 1986). We have established refund procedures for these funds, which have been made available through consent orders entered into by the DOE and numerous firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,045 (1987); A. Tarricone, Inc., 15 DOE ¶ 85,495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986). The refund procedures set forth in these cases specify that in order to receive a refund, an applicant generally must: (1) document its purchase volumes; and (2) show that it was injured by alleged crude oil overcharges. In order to receive a refund for crude oil overcharges, an applicant that was an end-user (i.e., consumer) of refined petroleum products must document its purchase volumes. City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987). Each applicant’s refund share is calculated using the current refund amount of $0.0016 per gallon.

Lisbon Schools and Durham Schools are separate school systems in the State of Maine that share a common superintendent. Petroleum Funds, Inc. (PFI), a private filing service located in Paris, Tennessee, filed Applications for Refund on behalf of each school system on August 10, 1990. After examining each of the refund applications, OHA determined that the estimation techniques PFI used

to derive the two school systems’ petroleum product consumption during the period August 19, 1973 through January 27, 1981 (crude oil price control period), were flawed. As a consequence, OHA requested that both school systems and PFI provide additional information to justify the volumes for which they had claimed refunds. OHA sent letters outlining the kinds of information it sought to Durham Schools and PFI on July 1, 1992, February 10, 1993, June 9, 1993, and November 16, 1994. Identical letters were sent to Lisbon Schools and PFI by OHA on June 30, 1992, February 10, 1993, June 9, 1993, and November 16, 1994. Neither school system, nor PFI, responded orally or in writing to OHA’s repeated requests for additional information. As a consequence, OHA dismissed the refund applications filed by Lisbon Schools and Durham Schools on January 17, 1995.

Shortly after the dismissals, on March 3, 1995, Lisbon Schools and Durham Schools submitted information in response to the four letters OHA had sent them. OHA has elected to treat the filings as Motions for Reconsideration.

II. Analysis of the Motions for Reconsideration

The DOE regulations do not explicitly provide for reconsideration of a determination in a refund proceeding. See 10 C.F.R. Part 205, Subpart V. However, in prior cases, we have used our discretion to consider the factual and procedural merits of Motions for Reconsideration if the movant presented compelling reasons to demonstrate that reconsideration was warranted. See Tenneco Oil Co./Major Oil Co., 13 DOE ¶ 85,322 (1985) (motion granted); Aminoil U.S.A., Inc./Saber Marketing Co., 17 DOE ¶ 85,491 (1988) (motion denied). In the past, OHA liberally accepted reconsideration motions when they were filed before the final filing deadline in the crude oil special refund proceeding, June 30, 1995. See Wheless Drilling Company, 25 DOE ¶ 85,110 (1996) (Wheless).

In the case at hand, both Lisbon Schools and Durham Schools submitted their reconsideration requests prior to the June 30, 1995 crude oil filing deadline. As we stated in Wheless, “[w]hen a refund application is dismissed because of an applicant’s failure to supply requested information, we generally reopen the case when the information is provided in a timely manner.” Id. at 88,282. As discussed below, we find that both school systems have submitted sufficient information to correct the deficiency that caused us to dismiss their earlier applications. Since Lisbon Schools and Durham Schools corrected the deficiencies prior to the crude oil filing deadline, we will grant their reconsideration requests and consider their crude oil refund claims, as supplemented.

III. Analysis of Refund Claims

As an initial matter, we find that both Lisbon Schools and Durham Schools were end-users of eligible petroleum products, viz., they did not resell any of the refined petroleum products for which they request refunds, but used them to heat school buildings and to fuel school buses and other administration vehicles. In addition, the two school systems have certified that they have not elsewhere waived their right to receive a Subpart V crude oil refund.

Both Lisbon Schools and Durham Schools have referred to their respective petroleum product consumption for the fiscal year ending June 30, 1994 in order to calculate their consumption levels during the crude oil price control period. After conferring with the Superintendent of Schools for the two school systems and their Director of Transportation, we have determined that the systems’ estimation method is reasonable with one modification. See Record of Telephone Conversation between Ann Augustyn, OHA Attorney, and Thomas Jarvis, Superintendent of Lisbon and Durham Schools (November 5, 1997); Record of Telephone Conversation between Ann Augustyn, OHA Attorney, and Michael Grace, Director of Transportation, Lisbon and Durham Schools (November 17, 1997). Neither school system will receive a refund for the K-1 fuel it claimed because each acknowledged using K-1 fuel in portable classrooms beginning in 1992, eleven years after the crude oil price control period ended. Id. After considering each Application carefully, we have concluded that refunds are warranted for the purchase volumes and in the amounts set forth in the Appendix attached to the Decision. The total volume for which refunds are approved in this Decision is 948,116 gallons and the sum of the refunds granted is $1,517.

Although we have carefully scrutinized the applicants’ claims and supporting data, the determinations reached in this Decision are based on the representations made by the applicants. If the factual bases underlying our determinations in this Decision are later shown to be inaccurate, this Office has the authority to order appropriate remedial action, including recision or reduction of the refunds.

The deadline for the crude oil proceeding, June 30, 1995, has passed. It is the current policy of the DOE to pay eligible crude oil refund claimants at the rate of $0.0016 per gallon., We will decide after the resolution of a few outstanding enforcement proceedings whether sufficient funds are available for additional refunds.

It Is Therefore Ordered That:

(1) The Motion for Reconsideration filed by Lisbon Schools, Case No. RR272-191, be and hereby is granted as set forth in Paragraph (3) below.

(2) The Motion for Reconsideration filed by Durham Schools, Case No. RR272-192, be and hereby is granted as set forth in Paragraph (3) below.

(3) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller, of the Department of Energy shall take appropriate action to disburse refunds in the amounts set forth on the Appendix from the DOE deposit fund escrow account maintained at the Department of the Treasury denominated Crude Tracking-Claimants IV, Account No. 999DOE010Z. The checks should be made payable to applicants listed on the Appendix and sent to them as the addresses set forth on the Appendix.

(4) To facilitate the payment of future refunds, the applicants shall notify the Office of Hearings and Appeals in the event that there is a change in its address, or if an address correction is necessary. Such notification shall be sent to:

Director of Management Information

Office of Hearings and Appeals

Department of Energy

1000 Independence Avenue, S.W.

Washington, D.C. 20585-0107

(5)The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary material submitted by the applicants. This Decision and Order may be revoked or modified at any time upon a determination that the basis underlying the refund application is incorrect.

(6) This is a final Order of the Department of Energy.

George B. Breznay

Director

Office of Hearings and Appeals

Date: December 16, 1997