By Quentin Fottrell, MarketWatch
Some businesses in Texas are hitting consumers when they’re down.
Lina Hidalgo, the judge Harris County, the largest county in Texas, said this week that Houston residents, already hit by power outages and severe weather, have complained about exploitative prices. “We’ve heard reports of outrageous prices on necessary items like food, water and housing. We will not tolerate price gouging. Violators can face fines of up to $250,000,” she wrote on Twitter.
“We’ve seen some anecdotal evidence of outrageous prices on necessary items like food and water — basically price gouging,” Harris County Attorney Christian Menefee told a press conference on Friday. He said there had been reports of up to 500 individual cases of price gouging, including allegations of packs of water being sold for 2 to 3 times the normal price, or packs of water being split into expensive, individual bottles.
“Whether it’s spiking the price of basic necessities or whether it’s posting an Airbnb with power for $1,000 a night, we can’t imagine something more cruel than to take advantage of people who are suffering right now in this disaster,” he added.
In one case, Wyndham Hotels & Resorts in Austin advertised a room for $999 per night. In a statement, the hotel told KVUE television news: “We do not tolerate price gouging and require that hotels comply with all local, state and federal laws. In speaking with the owner of this hotel, which is independently owned and operated as a franchise, it’s our understanding that the temporary rate increases seen online were the result of the property working to close out its inventory as it managed the loss of power and other utilities.”
“We have since been assured that no guests were charged, nor was there any intent to charge, the rates shown. While the hotel is not accepting new reservations, guests currently staying at the property are being allowed to extend their stay at no additional cost while they wait for conditions to improve,” the company added.
As of Monday, there were 15,718 Texas households still without power, down from 200,000 on Friday and 4 million earlier in the week, according to the outage tracking site, Poweroutage.us. Meanwhile, millions of people were under a boil-water advisory.
Residents are, understandably, frustrated. “There’s people on a boil water notice here in Texas, without power or gas. How are you supposed to know you’re on a boil water notice if you can’t leave your house and no way to check news,” one woman wrote on Twitter , “and how are you supposed to boil water without power or gas.”
Price gouging on necessities during a declared emergency in Texas is illegal under the law. That includes “selling or leasing fuel, food, medicine, or another necessity at an exorbitant or excessive price.” Those who do are subject to a civil penalty of up to $20,000 for each violation or up to $250,000 if the victim was over 65 years of age.
Freezing rain and low temperatures have created dangerous conditions in the state. Electrical power outages, frozen pipes bursting in buildings and homes have been reported across the state. To file a complaint, officials recommend residents take a photo of the receipt, and submit them to the county attorney with details of the business, time and date of purchase and brand item.
Texas Attorney General Ken Paxton said, “No one is exempt from price gouging laws in Texas. Any person selling goods, necessities, or services at an exorbitant price will be prosecuted to the full extent of the law. I will not stand for any person or business unlawfully taking advantage of Texans,” according to a statement his office posted on Twitter /zigman2/quotes/203180645/composite TWTR +2.65% .
Five days after the severe winter storm crippled the state’s power grid, Republican Senator Ted Cruz flew to Cancun on Wednesday with his family, but after photos of the senator at the airport and on the plane led to a backlash on social media, the senator quickly returned to Texas on Thursday, and said he only planned to stay one night.
However, Cruz later told Houston’s KTRK-TV that “the plan had been to stay through the weekend with the family.” He said he had “second thoughts” about the trip to Cancun when he boarded the plane, and said the decision to leave the state while hundreds of thousands of people were without power was “obviously a mistake.”
“When I arrived and saw the initial firestorm, what had started as second thoughts that I had as soon as we left grew even greater,” he told the local television station. “I certainly regret this has become a distraction.” He added, “I was taking care of my family the same way Texans all across the state were taking care of my family.” One reporter described that flub a “ Freudian slip .”