Case No. RG272-00679

May 29, 1997

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Application for Refund

Name of Applicant:Farmers Cooperative, Thorp

Date of Filing: July 3, 1995

Case Number: RG272-679

This Decision and Order will consider the Application for Refund filed by Cooperative Services - Clark County (Cooperative Services) on behalf of Farmers Cooperative, Thorp (Farmers Cooperative). Cooperative Services purchased the assets of Farmers Cooperative in 1985 and the prior members of Farmers Cooperative became members of Cooperative Services. The application is based upon Farmers Cooperative’s purchases of refined petroleum products during the crude oil price control period (August 19, 1973 through January 27, 1981). Cooperative Services has requested a refund from crude oil funds available for disbursement by the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE) under the provisions of 10 C.F.R. Part 205, Subpart V.

In the past, purchasers of refined petroleum products were allowed to apply to the OHA for a refund from crude oil overcharge funds collected by the DOE. 51 Fed. Reg. 27899 (August 4, 1986). We have established refund procedures for these funds, which have been made available through consent orders between the DOE and numerous firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987); A. Tarricone, Inc., 15 DOE ¶ 85, 495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986). The refund procedures that we have established specify that, to receive a refund, an applicant generally must: (1) document its purchase volumes; and (2) show that it was injured by crude oil overcharges.

We have further established that an applicant is presumed to have absorbed rather than passed on crude oil overcharges if it (1) was an end-user (ultimate consumer) of petroleum products; (2) was in a business unrelated to the petroleum industry; and, (3) was not subject to the price regulations of the DOE or its predecessors. 52 Fed. Reg. 11737 (April 10, 1987); City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987). Such an applicant is presumed to have been injured and does not need to provide a showing of injury.

Farmers Cooperative was an agricultural cooperative. Its application is based on petroleum products that it purchased for resale to the farmers who were its members. We regard a refund application filed by a cooperative that resold petroleum products to its members as a claim filed on behalf of the members themselves. Farmers Union Oil Co., 17 DOE ¶ 85,464 (1988). A cooperative can thus claim the presumption of end-user injury to the extent that its members were end-users. Consequently, we will consider granting a refund to a cooperative based on products resold to its members on the condition that it certify that it will pass through the refund to its members.

The farmers who composed Farmers Cooperative’s membership are end- users. Cooperative Services has certified that it will pass through any refund received to its members. We will therefore consider Cooperative Services’ claim under the presumption of end- user injury.

We have carefully reviewed Cooperative Services’ application. We also contacted Cooperative Services by telephone to verify that it is still in business. We verified that the records submitted are authentic and the gallonage claim is correct. Therefore, we are satisfied that Cooperative Services’ gallonage claim is reasonable.

The total volume approved in this Decision and Order is 8,789,223 gallons of refined petroleum products. The total refund amount granted, which is calculated by multiplying the approved gallonage claim by the volumetric refund amount of $0.0016 per gallon, is $14,063.

The final deadline for the crude oil proceeding was June 30, 1995. It is the current policy of the DOE to pay eligible crude oil refund applicants at the rate of $0.0016 per gallon. We will decide whether sufficient crude oil overcharge funds are available for additional refunds for this and other successful applicants when we are better able to determine how much additional money will be collected from firms that have either outstanding obligations to the DOE or enforcement cases currently in litigation.

It Is Therefore Ordered That:

(1) The Application for Refund filed by Cooperative Services - Clark County is hereby granted as set forth in Paragraph (2) below.

(2) 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 $14,063 from the DOE deposit fund escrow account denominated Crude Tracking-Applicants 4, Account Number 999DOE010Z, maintained at the Department of Treasury to “Cooperative Services - Clark County, Attn: Arnie Erickson, Re: Farmers Cooperative, Thorp, P.O. Box 220, Greenwood, WI, 54437.”

(3) Cooperative Services shall pass through to its members/patrons any refund that it receives on a dollar-for-dollar basis.

(4) To facilitate the payment of future refunds, Cooperative Services shall notify the Office of Hearings and Appeals in the event that there is a change of 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 materials submitted by the applicant. These determinations may be revoked or modified at any time upon a finding that the factual basis underlying any Application for Refund is incorrect.

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

George B. Breznay

Director

Office of Hearings and Appeals

Date: May 29, 1997