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Conway Asks For Exemption From Budget Cuts For Attorneys

State prosecutors in Kentucky say Governor Steve Beshear’s proposed budget cuts could be damaging to the legal system.

To cope with a $456 million shortfall, Beshear has asked all state agencies to reduce their budgets by 4%. Attorney General Jack Conway has asked that county and commonwealth’s attorneys be exempt from those cuts.

Conway’s spokesperson Allison Martin says most of their budgets go to salaries, and cutting those funds would mean taking prosecutors out of the courts.

“There’s been talk of furloughing. There’s been talk of layoffs,” she says. “So there are a lot of options that commonwealth’s and county attorneys across the state of Kentucky are talking about to try and deal with these proposed budget cuts.”

Martin says her office hasn’t heard from Beshear about the exemption, but she expects an answer soon.

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FTC Enters Gas Prices Investigation

The Federal Trade Commission has joined an investigation into Louisville gas prices. The agency’s concern is that motorists here are paying higher prices because of lack of competition among gas wholesalers.

The attorney general’s office has been gathering information for its own investigation into why Louisville-area gas prices are consistently higher than prices in the rest of the state. The FTC recently requested a copy of that information.

Attorney General’s Office spokesperson Allison Martin says officials are looking into whether the Marathon-Ashland merger has created a lack of competition in the Louisville market, and the FTC could take action to remedy that.

“They could force Marathon to divest some of its interest here in the state of Kentucky to create more competition,” says Martin, “but that’s a little way down the road and this is going to be a process that does take probably several years.”

The merger took place in 1998, but the FTC noted at the time it could create an unequal market. They reviewed the market again in 2004 but took no action.

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Dropping Oil Prices Unlikely To Sway KY Investigation

With oil prices dropping to near $100 dollar per barrel, the investigation into high gas prices in Kentucky is gathering new data.

Attorney General Jack Conway, Governor Steve Beshear and Louisville Mayor Jerry Abramson are conducting the investigation. The original investigation focused on Louisville, but now has expanded to the entire state.

The group is watching to see if gas prices in Kentucky drop in response to lower oil prices. But Attorney General spokesperson Allison Martin says the issue is endemic.

“We do have questions about this, but this is not just a situation that’s going on in Louisville and in Kentucky but it’s a situation that other states are seeing at this point as well,” she says.

Conway has issued civil subpoenas to area gasoline wholesalers and expects information on their pricing structure by mid-October.

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KY Officials Issue Subpoenas In Gas Probe

A group of elected officials investigating Louisville’s high gas prices are intensifying their focus on wholesalers.

Attorney General Jack Conway, Governor Steve Beshear, Congressman John Yarmuth and Louisville Mayor Jerry Abramson launched their investigation six weeks ago. So far, they’ve ruled out Louisville’s use of reformulated gas and retailer collusion as possible causes of the higher prices. They say retailers across the state earn the roughly the same amount from gas, and other cities using RFG have lower prices than Louisville.

Conway announced Friday that he has issued subpoenas to Kentucky fuel wholesalers. He’s also asking the Federal Trade Commission to investigate the 1997 merger of Marathon and Ashland Oil.

Yarmuth blames the merger for creating a monopoly and driving prices up.

“With one company providing 90% of the fuel for our community, up to 90% of the fuel, and a lack of regulation from Washington, this was predictable,” he said.

The group expects to have more information in 45 days, at which point they may pursue legal action against Kentucky fuel wholesalers.