AAFES gas pricing explained
By Senior Airman Justin Weaver, 354th Fighter Wing Public Affairs
/ Published November 01, 2006
EIELSON AIR FORCE BASE, Alaska -- While the Army & Air Force Exchange Service gas pricing policy may appear mysterious to some, it does have definitive explanations and policies, as set by the AAFES Board of Directors, composed of senior leaders from across the Army and Air Force.
In the United States, AAFES gas stations conduct surveys of five or more local locations selling motor fuel, excluding members-only clubs, at least once a week.
"This process allows AAFES to establish a fair and competitive price equal to the lowest price surveyed for each grade of fuel sold," said Mike Durbin, Eielson AAFES Service Station manager. "Any income from the sale of fuel goes to cover operating expenses and generate monies for the Morale, Welfare and Recreation program."
Prices are adjusted appropriately to match or beat the lowest price surveyed, each day if necessary, he said.
"Most people do not know that as far as the sale of gasoline is concerned, the playing field is basically leveled when compared to outside gasoline retailers," he said. "Military exchanges are not generally subject to federal, state and local taxes for merchandise sold in retail stores. The sale of gasoline is different."
The exchanges pay taxes on gasoline under the law -- the Hayden Cartwright Act, 4 USC, Section 104, to be exact, he said. They also must pay other costs such as underground storage fees. And, just as with gas stations outside the gate, the costs must be folded into pump prices.
Additionally, gas prices can change rapidly due to oil supply and disruptions stemming from world events or domestic problems, such as refinery or pipeline outages.
"Gas pricing is a very complex issue impacted by world markets as well as political and economic factors," said Mr. Durbin. "AAFES tries hard to pass along a savings, but the exchanges can't take a loss -- they cannot charge less than the gas costs them."