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August 16, 2017 | Vol. 67, No. 16

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Dear PEI Member:

The National Association of Wholesaler-Distributors (NAW) represents nearly 80 national line-of-trade associations involved in wholesale distribution. PEI has been an NAW member since the 1960s.

Four years ago, PEI also affiliated with a comparable group that represents the interests of manufacturers, the National Association of Manufacturers (NAM). The chief executive officers of more than 250 trade associations participate in NAM’s Council of Manufacturing Associations.

In the last month, PEI participated in the summer meetings of both NAW and NAM. Here’s a snapshot of key takeaways gleaned from various presentations and workshops, as well as one-on-one conversations with the other association executives.

National Association of Wholesaler-Distributors (July 10-12)
Although acknowledging that Washington is a mess right now, NAW experts said they are pleased with two pro-business actions taken by the Trump administration: the serious effort to reduce burdensome federal regulations and initiation of a process to scale back the overtime pay expansion launched in the last days of the previous administration.

Looking ahead, NAW’s primary legislative focus is tax reform, with a goal to ensure that any lowering of rates and elimination of deductions does not increase the effective tax rate for distributors. NAW government affairs staff also is working to protect last-in-first-out (LIFO) accounting, a method that yields a higher cost of goods sold and lower taxable income for many wholesale distributors. Some legislators propose elimination of LIFO as one strategy to raise federal revenue; however, NAW staff said that the House Republicans’ current tax blueprint would preserve LIFO.

Keynote speaker Herb Meyer, an analyst widely recognized as the first senior U.S. government official to predict the fall of the Soviet Union, spoke on what he called “today’s biggest underreported news story”: the rapid emergence of a global middle class. Meyer noted that a world coming out of poverty will need an enormous amount of fuel and fueling infrastructure, a prospect that bodes well for internationally oriented PEI businesses.

PEI Forming Service Tech Training Committee

EPA Expands Greenhouse Gas Emissions Review

Skimmer Fraud Increasing in Florida

Free RP900 Webinar


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Conversations with other distributor association CEOs confirmed that most are dealing with issues similar to those facing petroleum equipment distributors. In particular, consolidation is changing the competitive landscape and forcing business owners to consider new alignments and revenue models. The shortage of service and technical labor also is a persistent problem in wholesale distribution. A few association executives said Amazon is increasingly disrupting the businesses of their traditional distributors. In fact, nearly a quarter of the association CEOs at the meeting reported that Amazon is now one of their members.

National Association of Manufacturers (Aug. 2-4)
Tax reform, regulatory reform and infrastructure development are at the top of NAM’s policy agenda. NAM lobbyists also are working to ensure that any renegotiation of the North American Free Trade Agreement (NAFTA) does not scrap positive aspects of the existing agreement, including international protections for intellectual property rights (trademarks, copyrights and patents).

NAM’s chief economist projects a 2.3 percent increase in the U.S. GDP this year, a welcome improvement over the 1.6 percent increase of 2016. But he also noted the dollar is falling, labor costs are rising and consumer debt remains at historic levels. As a result, when the next recession comes—perhaps as early as 2018—the economy will face a hard landing.

Association executives at the NAM meeting discussed how best to balance the means, frequency and substance of member communications. Most associations are moving toward greater use of permission-based communications to give members the types of messages in which they have shown the greatest interest. PEI also is seeking to adapt this strategy into our communication channels.

In 2016, PEI released three tools to help members address the industry-wide shortage of service technicians: recruitment videos, a skills assessment test and a service technician training manual with an accompanying test. At the request of the PEI Board of Directors, the association is forming a new ad hoc committee to recommend additional service tech-related resources, if any, that PEI should develop. The committee will conduct much of its work by email and telephone, with the possibility of one face-to-face meeting in late 2017 or early 2018. If you are interested in serving on this committee, please send your name, company, contact information and a brief statement of your qualifications to Rick Long at rlong@pei.org

The U.S. Environmental Protection Agency (EPA) announced Aug. 10 a 45-day comment period on greenhouse gas (GHG) emission standards for 2021 model-year vehicles. The EPA had previously indicated it would review the GHG standards for 2022-2025 model-year vehicles. In a press release, the EPA stated its intent to harmonize the GHG standards with the Corporate Average Fuel Economy (CAFE) standards administered by the Department of Transportation (DOT). On July 26, the DOT’s National Highway Transportation Administration published notice of its intent to evaluate the CAFE standards for 2021 model-year vehicles in its next rulemaking.

Florida has been among the most aggressive states in combating credit card skimmers in gasoline dispensers. For example, legislation that took effect in October 2016 mandated the use of security devices on dispensers and strengthened penalties for credit card fraud. So far, however, skimming in the state continues to rise. Through the first seven months of 2017, inspectors with the Florida Department of Agriculture located and removed 315 dispenser skimming devices, as compared with 219 for all of 2016. Effective October 2017, a new Florida law will make the possession or sale of skimming equipment a crime.

Last month, PEI released a major revision of RP900: Recommended Practices for the Inspection and Maintenance of UST Systems (see July 19, 2017 TL). To help state regulators and PEI members better understand key provisions of the new document, PEI will host a free, one-hour webinar at 10 a.m. CDT, Tuesday, Sept. 19. Presenters are four members of the committee responsible for drafting PEI/RP900-17: Scott Boorse, Wawa Inc.; Ryan Haerer, EPA Office of Underground Storage Tanks; David Piercey, JD2 Environmental Inc.; and Ben Thomas, UST Training. In addition to presentations from the panelists, the webinar will allow time for attendees to ask questions.
To register, click here. Registrants will receive a confirmation email with instructions for joining the webinar.

As in past years, PEI is seeking “Find Red” volunteers to greet and help 2017 PEI Convention attendees find their way around McCormick Place, the site of this year’s event. Members who volunteer by this Friday, Aug. 18, will be recognized in the PEI convention program, on convention signage and on the Find Red page on the PEI website. To learn more and sign up, click here.

Champion Laboratories Inc./Petro Clear Filters
announced that R-J Sales & Associates Inc. will represent the company in eight states in the southeastern United States. R & D Marketing Inc. will represent the company in 13 western states.
Emco Wheaton Retail Corp. appointed Heather K. Mallard chief operating officer and general counsel effective Aug. 1. Mallard is a former partner of the Womble Carlyle law firm and previously served as a senior corporate officer and general counsel of a publicly traded, energy-technology holding company.
Jarvis Lighting named J.U.R its manufacturer representative for petroleum-related products in five western states.
Petroleum Solutions Inc. (PSI) promoted Troy Morris to service manager for the San Antonio branch. In his new role, Morris will oversee petroleum service technicians, dispatch and service billing for the San Antonio region. Troy has been with PSI for more than 10 years.
Seneca Companies named Clif Coker corporate service manager. Coker was with Murphy USA for 11 years, most recently as its operations maintenance manager. Seneca also appointed Ed Rogers account manager and project manager, with responsibility for supporting construction, upgrades and equipment replacement projects for major accounts.
VST appointed East Coast Associates Inc., as its manufacturer representative for the Northeast and Mid-Atlantic United States.

“Contrary to negative reports out of the U.S. Dept of Energy, gasoline demand is up 1% so far this year
and 2017 is on track to beat 2016’s all-time record.”—Lundberg Letter, Aug. 7, 2017
“Oklahoma's bid to help close a budget shortfall with a new $100 fee on electric vehicles drew a court challenge from the Sierra Club, which argues the state didn't follow the correct procedures for enacting a tax or properly measure the benefits of having those cars on the road.”—Bloomberg BNA Environment Reporter, Aug. 11, 2017
“Fuel theft in the United States is becoming big business, with criminal gangs using skimmed credit-card information to steal fuel from gas stations and specially equipped trucks and vans to carry it away. Criminals can earn $1,000 or more per day reselling the fuel to unscrupulous truckers, construction sites and other gas stations that are looking to cut costs, according to an Associated Press report.”—CSP, Aug. 11, 2017
“Waste Management announced a significant milestone in its natural gas fleet journey, opening its 100th natural gas fueling station. … The company also celebrated a significant milestone of operating 6,000 natural gas trucks, which is the largest heavy-duty fleet of its kind in North America.”—USGasVehicles.com, Aug. 8, 2017

Tennessee fleet management and payment solutions provider. Comdata, 5301 Maryland Way, Nashville, TN 37207, has applied for affiliate division membership. Kevin Eckelkamp is vice president of products for the company, which was established in 1969. Comdata provides fleet management and B2B payment solutions and also manufactures a card lock system and POS system. Sponsored for PEI membership by Joey Batchelor, GuardTech, Jacksonville, FL.
Florida installation and service firm. Florida Petroleum Services Inc. 2078 S. Orange Blossom Trail, Apopka, FL 32703, has applied for service and construction division membership. Matthew Wood is vice president of the firm, which was established in 1981. The company provides installation and service of fueling equipment at convenience stores. Sponsored for PEI membership by Kimberly Wood Savoy, DonWoodInc, Orlando, FL.
Maryland petroleum service provider. Petroleum Standards, 5566 Rhonda Road, Sykesville, MD 21784, has applied for service and construction division membership. Scott Jones is operations manager for the firm, which was established in 2010. The company offers petroleum service, inventory controls and reconciliation, weights and measures service and calibration of retail and bulk facilities. Sponsored for PEI membership by JT Celani, Davis, Conyers, GA.


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© 2017
Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Richard C. Long, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.