Stores Pay the Price for Bad Info at Register

Erie Times-News (PA)

November 9, 2009

Estella Hyde doesn’t take her eyes off the register as her groceries make their way down the checkout lane and into her cart.

She knows she could be charged the wrong amount. “Not hardly a week goes by when I do my shopping and something does not ring up correctly,” said Hyde, a resident of Linesville, PA, and volunteer president of the Pennsylvania AARP.

In 2008, Pennsylvania Department of Agriculture inspectors issued 28 failing grades in Erie and Crawford counties for price accuracy tests, about 17% of inspections. Erie County had the highest number of businesses prosecuted for price inaccuracies in the state, according to the department.

Critics contend the state’s cash-strapped price-inspection program fails to hold businesses accountable. They argue many stores are never inspected, while others are not tested frequently enough or are tested by untrained store employees. “I don’t know if they were ever truly adequately staffed,” Hyde said of the state Agriculture Department’s inspection program. “The consumer should really feel that they’re getting what they’re paying for.”

‘Terrible shape’

State employees weave through aisles at stores during inspections, typically scanning 50 to 100 items per store with a hand-held scanner. The dollar amount displayed on the scanner must match advertised prices in fliers and on shelves.

Under state law, all price-scanning systems are required to be inspected every 12 months. Despite this mandate, John Dillabaugh, director of the Agriculture Department’s Bureau of Ride and Measurement Standards, said about half of price-scanning systems are untested.

Many stores avoid scrutiny because they are not required to notify the department about new scanners. “We’re not putting the resources into going into every store and hunting for (new scanners),” Dillabaugh said. “We try to get our inspectors to do it as part of their routine system.”

This lack of oversight has frustrated consumer advocates such as Mary Bach, vice president of the volunteer scanning certification advisory board for the Pennsylvania Food Merchants Association. “We’re in terrible shape,” Bach said. “There is no equity in the marketplace in Pennsylvania.”

Of the stores that are inspected, many have fallen behind schedule because the state now has fewer inspectors. Because of funding cuts, the Agriculture Department’s Meadville Office’s inspection staff was cut in half. The office’s inspectors, who are responsible for 237 Erie County businesses, have visited only 24 stores in the county for price checks so far this year. In Crawford County, 13 out of 55 businesses have been inspected.

“There’s no way we’ll be able to hold our inspection schedule as we did previously,” said Josh Stepanian, regional supervisor for the state Agriculture Department.

Three inspectors now test scales, gas pumps, timing devices and numerous other items in a 10-county region. Dillabaugh said price-verification tests are low on inspectors’ priority lists because consumers can easily check their receipts, while other tests, such as scales, have more of an “unknown factor.”

Stores can be fined

When it had a full staff, the Meadville office netted more prosecutions than any other region in the state in 2008. Stores fail an initial test if more than 2% of items tested are overcharged. If a routine test is failed, a business is re-inspected. Repeat failures could lead to prosecution, which is usually accompanied by a fine between $100 and $300.

Brad Lundberg, a weights-and-measures inspector with the state Agriculture Department in Meadville, said he often encounters problems when sale prices are not updated in computer systems. Other overcharges are caused by third-party vendors stocking shelves and not communicating correct prices to store management.

Of the 12 cases of price inaccuracies prosecuted in Erie and Crawford counties in 2008, seven were for four Country Fair convenience stores. One Erie Country Fair failed four inspections in 2008 alone and was prosecuted three times.

Paul Rankin, vice president of sales and marketing for the company, said errors were mostly caused by outdated sale signs or price tags in the wrong place. “We were a little shocked when we found the errors,” he said. “We looked at everything and tried to address it.”

After hiring the Pennsylvania Food Merchants Association to review its scanning systems, Country Fair bought hand-held scanners and label-printing machines for all of its stores. Employees now also price check all items at least once a month, Rankin said.

Consumers can sue

If items do not ring up properly, watchful customers can typically resolve the issue by raising their concerns with store clerks or managers.

Others, such as consumer advocate Bach, a resident of Murrysville in Westmoreland County, take it a step further. When Bach is overcharged, she returns to purchase the same item. If she is overcharged again, Bach often elects to sue the store. “I can prove what happens at the cash register,” she said.

In May, she received a check for $266 after settling a case against a Westmoreland County Walmart, where discounted Easter merchandise that should have cost $3 rang up at $5 both times she bought it, according to her hometown newspaper’s website, YourMurrysville.com.

Consumer laws allow shoppers to sue for $100 for each overpriced item, along with court costs. Bach recommends consumers note prices of items on their shopping list before heading to the checkout lane and remain watchful for items that ring up at the wrong price. But she and other activists think a lot of the errors could be prevented with better inspections. Bach opposes the expansion of a program allowing companies to inspect themselves.

The Agriculture Department’s private examiner program permits store employees to receive training and become certified inspectors. A total of 28 such programs across the state report their results to the Agriculture Department. Dillabaugh said these private examiners are just as competent as state inspectors. “We’re not seeing anyone just rubber-stamping that the stores are good,” he said.

But others doubt how effective the employee-conducted tests are. “There’s virtually no oversight at all with that portion of the program,” said Dean Ely, director of the Pennsylvania Association of Weights and Measures, which is made up of weights and measures officials, as well as industry members from businesses.

Ely, who retired as a regional director for the Agriculture Department in 2003, said Pennsylvania has always lagged behind in its own inspection schedule. He said the state should implement a longer inspection cycle with more stringent penalties. “They have a tremendous amount of power given to them, but they don’t use it,” he said.

The level of training for private examiners also has been questioned. In July, a training session for new price inspectors in Reading lasted less than three hours. Bach, who attended the session, said trainees were not tested before receiving certification. “You could literally sleep through the training and be certified,” she said.

After hearing about the shortcomings of the training, Dillabaugh said future trainees will have at least a full day of instruction and will be tested to gain certification.

Ken Butcher, a group leader at the National Institute of Standards and Technology, wrote the training manual for price-verification tests used in Pennsylvania and other states. He said most individuals need at least two days of training and should be tested to receive certification.

Because many shoppers don’t have the time to review all their receipts, Butcher said, objective inspectors with sufficient training are crucial to consumer protection.