Gouging Complaints in Charley's Wake

ORLANDO, Fla. – The oak tree in Ilyse Kusnetz's back yard caused one headache when it crashed into her house during Hurricane Charley (search). Now the tree is sprouting a second worry: price gouging.

Kusnetz, 38, said Wednesday that she didn't have enough time to get several estimates from companies willing to cut it down and haul it away, so she's paying an Ohio-based crew $2,400.

"That might be reasonable and that might not, but there's no way of knowing," she said. The price could drop after a wait, Kusnetz acknowledges, yet a delay could bring more damage to her house.

In Charley's aftermath, price gouging is a growing concern in Florida. Homeowners want damage fixed quickly. They want ice, gas and hotel rooms. Unscrupulous business owners feed off that impatience, and offer their goods and services for a fee far beyond reasonable.

"I think it's horrific that people would do that," Gov. Jeb Bush (search) said. "I don't sense that is the defining element of this storm, though."

The state has received 1,854 gouging complaints from consumers in a week, the Attorney General's office said Wednesday. Those include purchases of hotel rooms, gas, lumber, hardware, generators, ice and water.

Attorney General Charlie Crist has already filed complaints against hotels in West Palm Beach (search) and Lakeland (search), accusing them of jacking up room rates as the storm approached. State law says anyone who price gouges in a disaster area can be fined $1,000 for each offense up to $25,000.

The state defines gouging as charging "grossly more" than what was charged for the product, on average, in the weeks before a disaster, unless the increase is the result of higher costs being imposed on the retailer.

For example, if wholesale gasoline prices suddenly spike, gas station owners aren't guilty of gouging if they raise their prices an amount that reflects their additional cost.

Construction industry leaders and lawmakers said consumers need to understand the difference, since many think any price increase during a disaster is an example of gouging.

"On the one hand, you don't want people to take advantage. We heard a horrible story about an elderly woman charged $8,000 to have a tree removed from the front of her home," said U.S. Rep Tom Feeney. "But you don't want to provide a disincentive for the electrical companies, the cleanup companies and dozens of other services that are in real demand."

Michael Carliner, an economist with the National Association of Home Builders, said prices of plywood could go up, for example, because supplies could be stretched. In that event, merchants have two choices: raise prices, or ration how much can be bought.

That, he said, puts businesses in a tight spot.

"I've know I've had the experience before of dealers telling me, 'Look, I'm just going to say that I don't have it. If I raise the price, people will say that I'm gouging, and if don't raise the price, I'm going to lose money."'