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S.B. 52

This document includes Senate Committee Amendments incorporated into the bill on Tue, Feb 1, 2005 at 10:35 AM by rday. --> This document includes Senate 3rd Reading Floor Amendments incorporated into the bill on Fri, Feb 11, 2005 at 3:32 PM by rday. -->              1     





Sponsor: Patrice M. Arent


             7      LONG TITLE
             8      General Description:
             9          This bill enacts the Price Controls During Emergencies Act.
             10      Highlighted Provisions:
             11          This bill:
             12          .    defines terms;
             13          .    prohibits a person from charging an excessive price for a good or service if a state
             14      of emergency exists;
             15          .    permits a person to increase the price of a good or service during a state of
             16      emergency if costs rise;
             17          .    requires the Division of Consumer Protection to enforce the act;
             18          .    allows the division to impose and enforce fines;
             19          .    allows the division to collect costs and attorney fees if the division prevails in an
             20      action;
             21          .    requires money collected by the division to be deposited into the Consumer
             22      Protection Education and Training Fund; and
             23          .    makes technical changes.
             24      Monies Appropriated in this Bill:
             25          None
             26      Other Special Clauses:
             27          None

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     Utah Code Sections Affected:
             29      AMENDS:
             30          13-2-1, as last amended by Chapter 222, Laws of Utah 2002
             31      ENACTS:
             32          13-41-101, Utah Code Annotated 1953
             33          13-41-102, Utah Code Annotated 1953
             34          13-41-201, Utah Code Annotated 1953
             35          13-41-202, Utah Code Annotated 1953

             37      Be it enacted by the Legislature of the state of Utah:
             38          Section 1. Section 13-2-1 is amended to read:
             39           13-2-1. Consumer protection division established -- Functions.
             40          (1) There is established within the Department of Commerce the Division of Consumer
             41      Protection.
             42          (2) The division shall administer and enforce the following:
             43          (a) Chapter 5, Unfair Practices Act;
             44          (b) Chapter 10a, Music Licensing Practices Act;
             45          (c) Chapter 11, Utah Consumer Sales Practices Act;
             46          (d) Chapter 15, Business Opportunity Disclosure Act;
             47          (e) Chapter 20, New Motor Vehicles Warranties Act;
             48          (f) Chapter 21, Credit Services Organizations Act;
             49          (g) Chapter 22, Charitable Solicitations Act;
             50          (h) Chapter 23, Health Spa Services Protection Act;
             51          (i) Chapter 25a, Telephone and Facsimile Solicitation Act;
             52          (j) Chapter 26, Telephone Fraud Prevention Act;
             53          (k) Chapter 28, Prize Notices Regulation Act;
             54          (l) Chapter 30, Utah Personal Introduction Services Protection Act; [and]
             55          (m) Chapter 34, Utah Postsecondary Proprietary School Act[.]; and
             56          (n) Chapter 41, Price Controls During Emergencies Act.
             57          Section 2. Section 13-41-101 is enacted to read:

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Senate 3rd Reading Amendments 2-11-2005 rd/crp
Part 1. General Provisions

             60          13-41-101. Title.
             61          This chapter is known as the "Price Controls During Emergencies Act."
             62          Section 3. Section 13-41-102 is enacted to read:
             63          13-41-102. Definitions.
             64          For purposes of this chapter:
             65      S. (1) "Consumer" means a person who acquires a good or service for consumption.
             65a      [ (1) ] (2) .S "Division" means the Division of Consumer Protection.
             66           S. [ (2) ] (3) .S "Emergency territory" means the geographical area for which there has
             66a      been a state
             67      of emergency declared.
             68           S. [ (3) ] (4) .S "Excessive price" means a price for a good or service that exceeds by more
             68a      than
             69      10% the average price charged by that person for that good or service in the 30-day period
             70      immediately preceding the day on which the state of emergency is declared.
             71           S. [ (4) ] (5) .S "Good" means any personal property displayed, held, or offered for sale by a
             72      merchant that is necessary for consumption or use as a direct result of events giving rise to a
             73      state of emergency.
             74           S. [ (5) ] (6) "Retail" means the level of distribution where a good or service is typically
             74a      sold directly, or otherwise provided, to a member of the public who is an end-user and does not
             74b      resell the good or service.
             74c           (7) .S "Service" means any activity that is performed in whole or in part for the purpose of
             75      financial gain including, but not limited to, personal service, professional service, rental,
             76      leasing, or licensing for use that is necessary for consumption or use as a direct result of events
             77      giving rise to a state of emergency.
             78           S. [ (6) ] (8) .S "State of emergency" means a declaration of:
             79          (a) an emergency or major disaster by the President of the United States of America; or
             80          (b) a state of emergency by the governor under Section 63-5a-5 .
             81          Section 4. Section 13-41-201 is enacted to read:
Part 2. Excessive Prices Prohibited

             83          13-41-201. Excessive price prohibited.
             84          (1) Except as provided in Subsection (2), if a state of emergency exists, a person may
             85      not charge S. a consumer .S an excessive price for goods or services S. sold or provided at
             85a      retail .S :

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Senate 3rd Reading Amendments 2-11-2005 rd/crp
         (a) (i) during the time period for which a state of emergency declared by the governor
             87      exists; or
             88          (ii) for 30 days after the day on which the state of emergency begins, if declared by the
             89      President of the United States; and

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Senate 3rd Reading Amendments 2-11-2005 rd/crp

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Senate Committee Amendments 2-1-2005 rd/crp
         (b) within the emergency territory.
             91          (2) A person may charge an excessive price if:
             92          (a) that person's cost of obtaining the good or providing the service exceeds the average
             93      cost to the person of obtaining the good or providing the service in the 30-day period
             94      immediately preceding the day on which the state of emergency is declared; and
             95          (b) the price charged for the good or service does not exceed the sum of:
             96          (i) 10% above the total cost to that person of obtaining the good or providing the
             97      service; and
             98          (ii) the person's customary markup.
             99          (3) S. [ A ] Upon request of the division, a .S person S. allegedly .S charging an
             99a      excessive price
             99a      under Subsection (2) S. [ has the burden of
             100      proving that the person meets the requirements of Subsections (2)(a) and (b).
] shall provide

             100a      documentation to the division that the person is in compliance with this chapter. .S
             101          (4) If a good or service has not been sold by a person during the 30-day period
             102      immediately preceding the day on which the state of emergency is declared, a price is not
             103      excessive if it does not exceed 30% above the person's total cost of obtaining the good or
             104      providing the service.
             105          Section 5. Section 13-41-202 is enacted to read:
             106          13-41-202. Enforcement -- Penalty.
             107          (1) The division shall enforce this chapter.
             108          (2) In determining whether to impose penalties against a person who violates this
             109      chapter, the division shall consider:
             110          (a) the person's cost of doing business not accounted for in the cost to the person of the
             111      good or service, including costs associated with a decrease in the supply available to a person
             112      who relies on a high volume of sales;
             113          (b) the person's efforts to comply with this chapter;
             114          (c) whether the average price charged by the person during the 30-day period
             115      immediately preceding the day on which the state of emergency is declared is artificially
             116      deflated because the good or service was on sale for a lower price than the person customarily
             117      charges for the good or service; and
             118          (d) any other factor that the division considers appropriate.
             119          (3) (a) If the division finds that a person has violated, or is violating, this chapter, the
             120      division may:

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         (i) issue a cease and desist order; and
             122          (ii) subject to Subsection (2)(b), impose an administrative fine of up to $1,000 for each
             123      violation of this chapter.
             124          (b) Each instance of charging an excessive price under Section 13-41-201 constitutes a
             125      separate violation, but in no case shall the administrative fine imposed under Subsection (2)(a)
             126      exceed $10,000 per day.
             127          (4) The division may sue in a court of competent jurisdiction to enforce an order under
             128      Subsection (2).
             129          (5) In a suit brought under Subsection (3), if the division prevails, the court may award
             130      the division:
             131          (a) court costs;
             132          (b) attorney fees; and
             133          (c) the division's costs incurred in the investigation of the violation of this chapter.
             134          (6) All money received through an administrative fine imposed, or judgment obtained,
             135      under this section shall be deposited in the Consumer Protection Education and Training Fund
             136      created by Section 13-2-8 .

Legislative Review Note
    as of 1-21-05 1:56 PM

Based on a limited legal review, this legislation has not been determined to have a high
probability of being held unconstitutional.

Office of Legislative Research and General Counsel

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