Are stores overcharging for milk?

Seven On Your Side
April 26, 2008 7:24:00 AM PDT
Gas prices continue to soar to record highs, and this week, there's more bad news. Stores across the country are now rationing rice as food prices rise as well. While consumers continue to be pinched, there is one item you probably buy each week that's price is regulated by New York state.

And when supermarkets charge too much, they have to deal with Tappy Phillips and 7 On Your Side.

We went to eight supermarkets, chosen at random, in Manhattan, Queens and Westchester to survey milk prices.

Each month, the New York Department of Agriculture sets price thresholds for gallons, half gallons and quarts. In April, they say retail prices shouldn't exceed $4 for a gallon, $2.05 for a half gallon and $1.06 for a quart.

We went to three stores on the Upper West Side and found just one under the threshold for a gallon.

D'Agostino's claimed "best prices," but their gallon topped the threshold at $4.59. Then, at the checkout, the price rose 30 cents to $4.89.

The manager said the lower price had not been entered into the computer system yet. And the highest price we found was at the Garden of Eden.

Whole milk for $4.99, nearly a full dollar over the threshold.

The price regulations were news to the store manager.

Tappy: "You didn't know about the thresholds?"
The manager shook his head no.

In Queens, we found another store manager who didn't know the guidelines.

Tappy: You didn't know about the threshold prices that the Department of Agriculture sets?"
He also shook his head no.

His was among two of the three stores we visited selling milk above the thresholds.

But the store Best Yet lived up to it's name. All three prices were below the thresholds.

As for Westchester, Food Emporium was within price guidelines, and D'Agostinos was over across the board.

In all, six of the eight stores we visited sold gallons of whole milk above the threshold price.

The Department of Agriculture spot checks milk prices, and if they're higher than the thresholds, they ask the store to justify it. Which they can, if their overhead is high, for example. But if they can't, the state orders them to lower it.

And back in the Garden of Eden? After we left, they lowered the price from $4.99 to $4.09.

To find out the milk price thresholds in New York, click here

There are no price thresholds in New Jersey.