published Saturday, August 27th, 2011

Gov. Haslam handed off decision on Memphis fuel waiver

NASHVILLE — Gov. Bill Haslam’s request for a federal waiver on gasoline standards is a first major test of his campaign pledge to recuse himself from issues that could affect the family-owned chain of Pilot Flying J truck stops.

An explosion at the Valero refinery in Memphis earlier this month led to concerns about gas shortages in the city, one of the country’s largest freight distribution hubs. Valero is also Pilot’s largest fuel supplier in the Memphis area.

The Republican governor told The Associated Press on Friday that he delegated the decision about requesting a fuel standards waiver to his deputy, Claude Ramsey.

“Obviously as governor I can’t just totally abdicate my responsibilities,” Haslam said in an interview outside his Capitol office. “But because I knew that somebody like you someday would ask a question, I said find out the right answer, talk to the local folks as well as our [Department of Environment and Conservation] people and come up with the right answer.”

The state ultimately requested and was later granted permission by the U.S. Environmental Protection Agency to relax fuel standards, which differ by season to improve air quality. The waiver allowed Memphis stations to begin selling winter-grade gas in August.

Haslam is a former president of Knoxville-based Pilot and still owns an undisclosed share in the privately held company with annual revenues of about $20 billion. His refusal to say how much he earns from Pilot became a major campaign issue last year, as did an executive order signed on his first day in office dismantling disclosure requirements on outside earnings for himself and his senior staff.

State Democratic Party Chairman Chip Forrester said Haslam’s signature on the letter requesting the waiver calls into question how removed he was from the deliberation process.

“People would understand the governor honoring his campaign pledge to recuse himself and respect that,” he said. “And now he has said ‘I just signed it, end of story.’

“It’s even more problematic that he’s just willy-nilly signing letters that are put on his desk,” he said. “I would hope the governor would demonstrate better leadership.”

According to the EPA website, emergency waivers can only be granted to ensure supply, not to keep prices under control.

The governor said there’s more to the fuel waiver than its impact on the family business.

“Obviously there’s a whole lot of people involved that are affected beyond Pilot,” he said. “At the end of the day it affects everybody that’s buying gas in Memphis.”

Haslam said he doesn’t expect this to be the only time such problems arise.

“Refineries have issues,” he said. “And while I’m governor, that will come up again, just given the odds.”

In that event, Haslam said Ramsey has standing orders to take the lead on whether the governor’s office needs to intervene.

“It helps to let Claude do all the background work and say yeah, this is the right thing to do for the state,” Haslam said.

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