When asked if the pricing policy works, he replied, “Stay here for 24 hours and see if it works.”

Judy Beck, public information officer for the Montana Department of Justice, said that charging more for credit card users is “not illegal provided it is clearly advertised. The issue becomes one of false or deceptive advertising, if someone charges a higher price than advertised, without people’s knowledge.”

Donna Doney, an investigator with the state Justice Department’s Consumer Protection Office, confirmed that the practice is legal. And, she added, consumers can complain to their credit card company.

Doney said gas stations in Montana can sell as high as the market may support, or below the maximum they think they might be able to reach, but that it is illegal to sell gas below cost, because “they don’t want to look like a monopoly and drive mom and pop stations out of business.

“It boils down to, (the customer) can buy or not,” Doney said. “You can buy the same glove at Wal-Mart or at Dillards.”

But, Doney continued, there is a cost to the retailer that takes credit card payments, and, unlike gas stations associated with larger oil companies, the small independent operations cannot get a volume purchase discount from their supplier, nor a discount for prompt payment.

“I feel bad for him, it’s a valid charge and it is legal for him to pass it on,” Doney said. “The gas stations do not make money on selling gas, but on purchases inside. But how do you compete if nobody shows up?”

Burnham isn’t feeling bad.

Gas stations operate on a very small margin of profit, he said. The charge from the credit card companies, often set at three percent, can “leave the merchant underwater,” Burnham said.

“We did this in an attempt to give our cash customers the very best price we could. I believe if you checked all around Montana you would find we have the lowest retail gas price in the state for cash customers,” Burnham said.

Further, he continued, he has had people on the street thank him for his price approach, and others call him at home to do so.

Burnham added that he was not criticizing any other fuel business, and they “are entitled to whatever success they get.”

But his way is to keep his price down for cash customers and raise it for credit card customers.

Reporter Joel Gallob can be reached at 363-3300 or jgallob@ravallirepublic.com

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Jo Ann wrote on Aug 6, 2008 9:12 AM:

" And what about the disabled person that it would be an ordeal if not impossible for them to go inside & stand in line to pay cash? One very important reason I use a credit card. "

Madman wrote on Aug 4, 2008 4:25 PM:

" WOW...With all the other important issues presented to the citizens of the Bitterroot Valley that get no comment, 12 cents on a gallon of gas and you are all hollerin' bout it?

Here's the thing. I don't buy anything if my Discover Card is not accepted for payment. As Mark mentioned, we get 5% back on gas and 1% on everything else we buy. Write one check at the end of the month, pay no interest AND get a rebate on everything we buy.

Now I go down the street and buy at a retailer that accepts my Discover Card and pay $3.80 per gallon with the discount. The price is the same as this scoundrel and I get a discount FOR using my credit card. Anyone see the dollars and cents logic here?

As far as the "bait and switch" issue, here's what I think. It may be legal but it shows a true lack of business ethics to do it, and to be so sneeky about it. Then claim to be serving the public with the lowest prices in town, plain bull...How many travelers have been duped for 12 cents a gallon by this business owner? Gives Hamilton a bad name. I have never bought a thing at this place and I surely never will because it both makes no financial sense and I don't patronize merchants that rip people off and pronounce their glory in doing so.

No, it seems here the issue is more SOUR GRAPES than anything. What John Mills calls "Whiner's that live on their credit cards" Sorry you people can't get a credit card like Discover! We got ours by living within our means and paying our bills on time.

So you local patrons go on buying with cash from this crook cause you can't get a Discover Card ... Boo Hoo John. "

Judy wrote on Aug 3, 2008 5:23 PM:

" This summer while vacationing in Hamilton, my husband and I purchased gasoline at the Gas n Grub. We sure appreciated the option of paying cash and getting a lower price. It is common knowledge that the credit card companies charge all retailers a credit card fee. Most places simply raise the cost of the product to pay for this fee even if the customer is using cash. So, I thank the Gas n Grub owner for not charging me the credit card's fee when I am not using credit. "

John Mills wrote on Aug 3, 2008 6:13 AM:

" Whiner's that live on their credit cards, it is pretty well spelled out and if you cannot read the sign(s) then you need to start paying attention. Go somewhere else where you can charge-it or write a check - part of Econ 101 says don't live beyond your means. A very sad of state of affairs... "

John wrote on Aug 2, 2008 12:33 PM:

" I was out there on vacation over 4th of July and CLEARLY saw that cash price and credit price was a big difference. I thought for a while about filling there but I'm particular about the quality of gas I put in and not knowing what brand, quality, etc, I chose not too. He's not a bait and switch operation. Oh, thought you'd like to know, we're at 3.59 now in Rochester, Mn "

JASON GARRARD wrote on Aug 2, 2008 10:55 AM:

" WELL WHAT IS THE PROBLEM? THE OWNER HAS BEEN HONEST BY PLACING SIGNS AND REASONS WHY HE DOES THIS. I HAVE BOUGH GAS FROM GAS AND GRUB FOR MANY YEARS AND HAVE HAD RETAIL BUSINESS OF MY OWN. IT IS EASY TO JUDGE WHEN YOU DON'T WALK IN ANOTHER SHOES. SO I SAY CARRY CASH OR PAY THE PRICE OR GO DOWN THE STREET TO THE BIG CORPORATE GAS STATIONS. BUT BY DOING SO WE HURT ONE OF OUR SMALL LOCAL BUSINESS WHO HAS TRIED TO BE HONEST AND FAIR WITH EACH OF US. I AM FOR THE LOCAL PEOPLE BUT SOMETIMES THEY NEED OUR HELP, AND ALL THAT DOES IS MAKE PEOPLE UPSET AND START SLINGING MUD. COME ON SUPPORT GAS AND GRUB AND BRING CASH, HE HAS DONE THIS LEGAL BY THE BOOK. BY THE WAY IF I DON'T HAVE CASH ON ME I HAVE NO PROBLEM WITH THE FEE BECAUSE I WANT TO SEE HIM STAY IN BUSINESS.

SINCERELY JASON GARRARD

GOD BLESS AMERICA "

Clara wrote on Aug 1, 2008 11:28 PM:

" I filled up at Gas-N-Grub a little over a month ago. This was before they had the sign on the big board informing consumers about the "cash" benefit. At that time there was only the little piece of paper taped to the pump indicating the price difference for cash vs. credit. I mentioned something to the employee inside that this was a sneaky practice and that it should be advertised more clearly.
I'm assuming I wasn't the only one complaining because not long after that I noticed the sign on the big board. I have no problem with small businesses trying to save a buck or two to compete with the big chains, but you need to make your policies clearly advertised....and now they are. So, I think we can all stop complaining and make the simple decision whether to pull in or keep on truckin'. "

HUTCH wrote on Aug 1, 2008 3:57 PM:

" as long as GAS-N-GRUB has a Montana Business License, it is a legitimate business. You, Penny, need to take Jonathon's advise and open your eyes or pay cash for your fuel. It's nobody's fault but yours! "

Penny Gaddy-Rhodes wrote on Aug 1, 2008 1:45 PM:

" Just went by Gas and Grub. Yes, below the HUGE red sign giving you the price for gas is a white sign with black letters telling you it is $0.12 higher for cards. However, if this were a legitimate business he would put the REAL price per gal and put the discount for cash below. When people see a sign that says $4.00 in a place where they usually look to check the price of gas that is what they expect to pay, period. I wonder just how many unsuspecting people fell for this cheap tick. When I purchase something from a department store I expect the same. If the price says $4.00 it better ring up $4.00 or Ill leave it there.

This paper should be ashamed of the story they ran. It made the owner into some kind of hero instead of telling it like it is.

From ABC news: "It's a typical bait and switch," AAA spokeswoman Michele Mount told ABC News. "You lure them in with an attractive price that could be lower than their competitors, and then you hit them up with harder credit card fees." "

Steve wrote on Aug 1, 2008 11:39 AM:

" The prices at Gas 'N Grub are the same for cash as the Exxon charges for credit card purchases. Who carries that much cash on them anymore ?
Also, with cash purchases, there is no paper trail for the retailer, and who knows what he's reporting on his taxes ? "

Penny Gaddy-Rhodes wrote on Aug 1, 2008 10:38 AM:

" Oh, my eyes are open. I looked at the HUGE red sign that said $4.00 for regular as MOST people do! It is bait and switch NO matter how you slice it. It is too bad people are ripped off in this way and accept it. Thankfully he is the ONLY one I have seen do this so far. I am VERY careful where I fill up now. "

Mark wrote on Aug 1, 2008 10:23 AM:

" I never have cash on me because I prefer to use either my debit card or Discover card. Once, and only once, I stopped at Gas & Grub to purchase gasoline and of course got charged the higher price. Ouch... lesson learned. I like debit/credit cards because it tracks your spending and there are terrific options out there to receive cash back, rewards, air miles, etc. I like my Discover card which gives me 5% back on all fuel purchases and 1% on everything else. I need to buy fuel and groceries anyways, and this is a better deal for me than paying cash over at Gas & Grub. So here's to those gas stations and grocery stores other than Gas & Grub who pay my debit and credit card merchant exchange fees: THANK YOU! "

Joe wrote on Aug 1, 2008 9:40 AM:

" I have been supporting Gas n Grub and they have the lowest gas prices in Hamilton by usually 2 cents or more...just don't use a credit card there or it can hurt your wallet!!! "

Jonathon wrote on Aug 1, 2008 9:30 AM:

" Not true, Penny! The tall, highway-side sign reads "ard price 12 cents higher" ... apparently the "C" fell off. Call it what you want ... but they are well within their rights to dissuede the use of credit cards to avoid the charges that the CC companies tack on. If you are being AWARE and paying attention to your surroundings, it shouldn't be a problem. OPEN YOUR EYES! "

Anna wrote on Aug 1, 2008 8:54 AM:

" Sad to hear that is what they are reduced to doing to keep their business going. I for one have not and probably will not stop there for gas. I find it more conveinent to stop at one of the Town Pumps where I know my credit card OR check WILL be excepted and I know the price of gas will be resonable. "

Penny Gaddy Rhodes wrote on Aug 1, 2008 8:18 AM:

" I called the Ravalli on this story. It is called the bait and switch exposed by ABC news. The ONLY place this is advertised is a LITTLE sign on the pump. If I had not known about this story I would have pumped $4.12 per gallon into my car instead of the $4 advertised without even knowing it. The price down the road was the same as his discount WITH my card. It is REALLY to bad it is happening here and that it is legal. This story is soft and failed to show exactly why this person is doing the bait and switch. Buyer beware and check the price on the pump BEFORE you purchase. "

Willie wrote on Aug 1, 2008 8:16 AM:

" I'd rather fill up elsewhere and spend the saved money on a candy bar. "

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