Iowa to allow half pricing at the gas pumps

The Iowa Department of Agriculture issued an order on Tuesday approving the change. It estimates about 5 percent to 8 percent of the state's 34,000 gas pumps have the older meters.

"When the price goes above $4, it goes back to zero," said Dustin Vande Hoef, spokesman for the department. "These prices came on quicker than anyone anticipated."

In the order allowing half-pricing, or displaying the price for a half-gallon of gas, the agriculture department says the rapid increase in gas prices caused a 60- to 90-day backlog on ordering replacement equipment.

Iowa is among a number of states preparing for half-pricing. Others include Washington state, North Dakota, South Dakota and Minnesota.

The last time mechanical meters had to be retrofitted with higher numbers when pump prices climbed was in late 2005, when gas went over $3 a gallon. Owners of older pumps installed kits that went to $3.999.

Vande Hoef said Wednesday that stations must install replacement meters by July 1, 2009. In the meantime, stations be allowed to sell gas by the half-gallon.

"They have to post the price per gallon. Just on the mechanics of the pump, they can go by the half-gallon," he said. "Half-pricing will allow them to put in $10 worth on the pump and go inside and pay $20."

Vande Hoef said the station must make the prices very clear--what the price per gallon is, and clear labeling on the pump that it's half-pricing.

Most of the older pumps are at smaller stations and at gas pumps at marinas, he said.