ASSEMBLY BILL TO LOWER GAS PRICES DIES IN COMMITTEE.

Byline: Mark Katches Daily News Sacramento Bureau

A bill designed to lower the price of gas by about 10 cents a gallon by taxing the profits of oil companies was killed Monday by a Republican-controlled Assembly committee.

On a partisan vote of 5-2 against passage, SB 14 failed in the Assembly Revenue and Taxation Committee, despite assertions from the bill's co-authors that oil companies are continuing to gouge the public at the pump.

Assemblywoman Sheila Kuehl, D-Encino, was one of the two committee members who voted for the bill.

The measure by Sens. Mike Thompson, D-Napa Valley, and Daniel Boatwright, D-Concord, would have lowered the sales tax on gas by 6 percent.

But to avoid a loss of billions in revenue, the bill sought to place a tax on oil companies to make up for the lost sales tax revenue.

``Right now they are gouging your constituents and my constituents,'' Boatwright said. ``And it's not right.''

Thompson added that the ``increases are unjustified, they're grotesque.''

The price of gasoline has stabilize and even dropped slightly in recent weeks, despite the peak driving season that traditionally marks higher prices starting with the Memorial Day weekend.

Statewide, a gallon of regular unleaded gasoline now costs $1.50. The prices peaked at $1.53 in mid-May, according to statistics compiled by the state Energy Commission.

The bill was opposed by oil company representatives and other business groups, who noted that gas prices are starting to show signs of dropping.

``We view it as an unfair, punitive approach to a situation,'' said John Geoghegan, a lobbyist representing the Western States Petroleum Association.

Republicans on the committee said they were concerned that the bill may not have made any difference because there were no guarantees that oil companies would not find other ways to pass the cost on to consumers.