(Source: MIRS.news, Published 09/10/2024) The Attorney General could take immediate action against hotels, retailers and energy providers whose costs go up by 10 percent or more during a state of emergency, under the newest iteration of previously introduced price-gouging legislation. 

Sen. Jeremy Moss (D-Southfield), one of the legislation's main sponsors, became involved in the price gouging issue in March 2017, when Michigan experienced a historic windstorm. The storm's center consisted of the same air pressure level as a Category 2 hurricane, and more than 800,000 DTE Energy customers lost power in Southeast Michigan. 

Moss received a call from a constituent, claiming that as people were looking for a safe place to weather the storm's fallout, a Southfield hotel went from charging $59 nightly to around $400 per night. The Senator said the hotel was "basically trying to profit off of human misery due to an emergency situation." 

"My office at the time reached out to then-Attorney General (Bill Schuette) to go after an unscrupulous business that was trying to take advantage of folks, and we basically found out that our price gouging law is basically 'tsk, tsk, don't price gouge,'" Moss said. "Any bad apple that preys upon a Michigander, especially during an emergency, are the exact type of people that we want to hold accountable." 

Moss spoke during a "Price Gouging Legislation Media Roundtable" today, which took place in the Senate Majority Leader's conference room. 

Other speakers included Sen. Mary Cavanagh (D-Redford Twp.) – a bill sponsor and chair of the Senate Finance, Insurance and Consumer Protection Committee – and bill sponsors Reps. Jason Hoskins (D-Southfield) and Laurie Pohutsky (D-Livonia). Attorney General Dana Nessel, a major backer of the legislation, also discussed why she wants the legislation approved. 

When she came into her role at the start of 2019, Nessel said she was really bewildered by "just how powerless the AG is here in Michigan compared to so many other states." 

For example, during the Democratic National Convention in Chicago, Nessel participated in a panel on Aug. 28, speaking alongside attorneys general from California, New York and Illinois. When it came time to discuss price gouging, Nessel described how the other three had state statutes to talk about addressing the issue. 

"And it's always, frankly, embarrassing to me that I have to say 'in Michigan, we can't do that,'" Nessel said. "When I look at the consumer protection divisions of other states . . . Ohio has twice as many investigators in their (consumer) protection unit and attorneys, because they have laws that enable them to protect (people) and pursue litigation." 

Without revamped consumer protection laws, Nessel said there's no reason to have the staff to look into price-gouging complaints. 

For example, according to a November 2023 analysis on Ohio's laws, the state statutes have a provision prohibiting sellers from charging a price "substantially in excess of like items for sale." Texas specifically prohibits certain goods and services being sold at "excessive prices" during a disaster and in Rhode Island, businesses are specifically prohibited from raising the cost of essential commodities immediately before or during a declared state of emergency. 

Assistant Attorney General Darrin Fowler said during the COVID-19 pandemic in 2020, Nessel repurposed her department's criminal investigators to visit grocery stores to look at prices and talk with management. By putting an eye on the issue, Fowler said a retailer did publicly admit to "mischarging" a cart of personal protective masks for $20. 

He said the department went from receiving 10,000 consumer complaints annually to more than 24,000 during 2020, with the increase driven largely by allegations of price gouging. He explained that while Nessel does have some authority to look into a single or a small group of price gougers, the department lacks tools for "general, unjustified market increase in prices." 

"The other thing that is very different under the current price gouging law, and what happens here, is our vehicle for an investigator," Fowler said. "We have to prepare a court document, go to (the) courts, show that there's evidence justifying an investigation, and then hope the judge signs off on that." 

The legislation consists of SB 954, SB 955 and SB 956, as well as HB 5895, HB 5896 and HB 5897. On the lodging side, it deals with hotels, bed and breakfasts and mobile home park sites and campgrounds. Furthermore, the bills deal with building materials like lumber, construction tools and windows, food and emergency supplies like flashlights, batteries and toiletries. 

For energy products, they address gasoline, propane and home heating oil. 

When such products go up by more than 10 percent without the vendor being able to cite a rise in labor or good costs impacting them, the Attorney General can bring forward actions for a court to charge a $1 million misdemeanor. 

Similar legislation was introduced by Moss and Sen. Ruth Johnson (R-Holly) in the 2019-20 legislative term, and received a hearing in the Senate Economic and Small Business Development Committee while the chamber was led by a Republican majority. 

In terms of anticipated opposition, Nessel mentioned the Michigan Chamber of Commerce, saying "I think when you have a lack of regulations, the Chamber is always going to oppose any regulations, no matter how necessary they are, and no matter how much they're supported by the public."