Industry Survival Fund Update
by Sean Cota, NEFI & Tom Tubman, AEC
Voluntary pilot program to begin running in Q4 2021 – liquid heating fuel dealers and wholesalers all across the country will soon be able to join
“We will not lie down and die at the hands of the utilities and their allies.” That’s the message heating oil dealers are delivering to their state associations and the industry at large. Since NEFI issued its call for an Industry Survival Fund, the response we have received from dealers across the country — including NEFI members and non-members — has been nothing short of amazing.
As a brief recap, in May, NEFI proposed a fundraising operation to protect and grow the liquid heating fuel industry for future generations. This plan entails the creation of a voluntary opt-out program through which participating dealers will pay half a cent per gallon at the rack to an Industry Survival Fund. Seventy percent of the money raised would go to participating state associations. Their boards would determine how to use these funds, which can pay for anything from legal expenses to competitive advertising. The remaining 30 percent would fund national efforts coordinated by NEFI and the American Energy Coalition (AEC). For additional details, please see “NEFI Proposes Industry Survival Fund” from last month’s issue.
Before we go any further, we would like to take a moment to thank everyone who voted in favor of this plan, as well as each dealer who reached out to NEFI and AEC independently to express support. Your commitment to your business’s future generations is a shining example of what makes our industry so important, and we look forward to helping you however we can in the months and years ahead as we enter the next phase in the fight for our industry’s survival.
Now that state associations have begun considering the Industry Survival Fund, the next step is to secure voluntary opt-ins from interested dealers and then wholesalers. Because the wholesalers will be responsible for collecting rack fees and remitting this money to the Industry Survival Fund on a quarterly basis, they will receive an administrative fee of 10 percent. Discussions with dealers and wholesalers have already begun and are moving full-steam ahead.
Meanwhile, NEFI and AEC are working to establish an Independent Oversight Committee comprised of representatives from our associations, the participating state associations’ boards, and wholesalers. We are working in coordination with Gray, Gray & Gray, who will serve as the program’s fiduciary executor, and Robinson + Cole, who is providing legal counsel to ensure antitrust compliance. With their assistance, we will carefully develop opt-out and opt-in communications for dealers and wholesalers as needed.
An Important Question
This brings up an important question that NEFI and AEC have already fielded from dozens of dealers: Can those whose state associations are not participating at this time join up independently? Without giving away too much, the short answer is yes, you can, and we strongly encourage it.
We are currently working out details of an opt-in mechanism for dealers all across the country. As we continue to field calls from dealers who are eager to do their part, we intend to provide further communications on this aspect of the program very soon, understanding that the more companies that participate, the better our industry’s chances for survival and an expanded business in a lower-carbon world (for example, see this month’s cover story, “Converting from Natural Gas to Biofuel”).
In the Meantime
The Industry Survival Fund is scheduled to begin collecting rack fees in Q4 2021, with the first disbursements slated for the end of Q1 2022. The gap is due to a legal requirement.
In the meantime, NEFI, AEC, and all state associations — including those that voted to participate in the Industry Survival Fund and those that did not — are already engaged in the fight of our lifetime. The electric utilities and environmental groups that seek our extinction are certainly not going to stop raising money for their cause over the next two quarters.
With this in mind, NEFI and AEC are conducting “bridge” fundraisers to help bring in capital for our industry’s immediate needs, including public communications, legislative advocacy, dealer education and more. If you haven’t already gotten a call or received a letter from us, you will soon. In the meantime, we strongly urge you to contribute to the fight for your industry’s survival. To do so, please donate to your state or local association on the front lines and consider giving further at nefi.com/donate and americanenergycoalition.com/donation.
The future doesn’t wait and neither should you.
Sean Cota is the President and Chief Executive Officer of NEFI. He can be reached at email@example.com. Tom Tubman is the Executive Director of AEC. He can be reached at firstname.lastname@example.org.