Affairs Committee passes HB 1208

House Bill 1208’s aim (PDF file; page 33) is to remove the illegality of the loss-leader (pricing goods below their production cost) from Colorado’s Unfair Practices Act. The Act, passed into law in 1937, is designed to prevent merchants from using predatory pricing to monopolize the market.

Use of the Act made news last year when two gas stations in Montrose sued Ohio-based Kroger Co., parent company of City Market and King Soopers, for its “buy groceries/get gas program.” The program offered a seven-cent-per-gallon discount when $100 worth of groceries was purchased in a month.

Despite no mention in the lawsuit, the Safeway grocery chain voluntarily stopped its 10-cents-per-gallon discount program in Colorado. Not limited to fuel, Target and Wal-Mart locations in Colorado voluntarily increased prices on their $4 generic medication programs.

The National Federation of Independent Business recently announced the results of a fax poll conducted Feb. 2 though Feb. 7 to NFIB-member, small business owners regarding HB 1208. Sixty-seven percent of owners were in favor of the bill, 29 percent opposed and 4 percent undecided.

However, there was bigger worry among the owners about growing government involvement in “the natural workings of the marketplace,” according to Tony Gagliardi, Colorado state director for the NFIB.

House Bill 1208 passed the Affairs Committee 8 to 3 and is on its way to the House for debate.

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