Rising diesel costs may drive up school budget - $100,000 to $200,000 more may be needed in 2003-2004 year

www.theleafchronicle.com By CAMERON COLLINS, JILL NOELLE CECIL The Leaf-Chronicle

Alicia Archuleta/The Leaf-Chronicle

Jay Buck fills one of the county's school buses at the Operations Complex on U.S. Highway 41A, Monday. In August, the district paid 64 cents per gallon of diesel and the current bid price is $1.18 per gallon.

A possible military conflict in the Mideast and oil worker strikes in Venezuela and Nigeria mean rising diesel prices -- translating into higher costs to transport Clarksville-Montgomery County's students.

School officials think their current budget can cover the higher costs this school year, but for 2003-2004 an additional $100,000 to $200,000 may be needed to buy fuel.

Two other Montgomery County entities also use diesel fuel -- the Highway Department and Bi-County Solid Waste. But County Executive Doug Weiland said it is premature to speculate about how the higher costs would affect their 2003-04 budgets.

"I buy fuel myself and have seen the rising costs," Weiland said. "I wonder, as I'm sure others are, if there is any end in sight."

Weiland said several negative factors such as a 40 percent rise in health-care insurance premiums, loss of state-shared revenue and other aspects are making the county's budget outlook bleak.

Individual department heads and elected officials are compiling preliminary budget requests, and Weiland said those should be submitted next week.

"Until we get hard numbers it's real premature to talk about how it will affect us," he said. "Obviously, all those things will impact us. This has all the prospects of being one of the worst budget years we've ever faced."

The 226 regular education and special needs buses in the public school fleet transport an average of 18,355 students each morning and afternoon. Typically, the buses travel 18,000 to 19,000 miles per day or about 3.4 million miles each year, said Joe Haley, Clarksville-Montgomery County Schools' chief operations officer.

The system annually uses about 365,000 to 370,000 gallons of diesel fuel.

In August, the district paid 64 cents per gallon of diesel and the current bid price is $1.18 a gallon.

Since Haley and other local school officials expected to spend an average of $1.05 per gallon, more money won't be needed for this year's budget. So far, Haley estimated, the system will pay about an average of 95 cents a gallon for diesel over the course of the 2002-03 school year.

School officials had planned to spend between $275,000 and $280,000 on diesel fuel for transportation this year. But next year, Haley predicted, the overall cost could be between $375,000 and $475,000.

"There's not much we can do about it," Haley said. "It depends on where (the price) falls. The oil distributors are telling us they don't think it'll rise much higher than it is right now unless there's a war and the oil fields are set on fire. They think it'll stay somewhere between $1.15 and $1.30, but they don't think it'll go any lower than that either."

The school district has tanks at four different locations for bus drivers to use as filling stations -- the Operations Complex on U.S. Highway 41A, Byrns Darden Elementary on Peachers Mill Road, the Montgomery Central complex in Cunningham and Liberty Elementary on Dover Road. The tanks can store a total of about 70,000 gallons.

Haley said he recalls only one other time when diesel costs rose so much, and they've never really recovered. There was a spike during the Persian Gulf War, but the situation wasn't complicated by the strikes in Venezuela and Nigeria, two of the top seven crude-oil producers in the world.

"I think we can expect to see a 30 to 40 percent increase on average but the market is so volatile that's really a guess," Haley said.

Another factor is a harsh winter across the northern portion of the country where homes and businesses used fuel oil for heating, causing the demand and price to rise, said Haley, who has 23 years experience in school transportation with the local district.

Cameron Collins covers education and can be reached at 245-0716 or by e-mail at cameroncollins@theleafchronicle.com.

Originally published Tuesday, February 25, 2003