Fuel Up: Rising Fuel Prices May Hit Next Year’s School and Municipal Budgets | Education

TUPELO • On Friday morning, Tupelo Public School District Transportation Director Gary Enis stopped at a local gas station to refuel a school bus with diesel fuel.

By the time the pump stopped, Enis had invested more than $400 in the bus, nearly double what it would have been last April.

Until the end of February, gasoline prices, which had been stagnant since the start of the pandemic, had been rising slowly for months. But the cost of oil shot up suddenly and dramatically after Russia launched its invasion of Ukraine. In mid-March, gasoline prices hit a national all-time high of $4.17, according to AAA.

Although prices at the pump have plateaued in recent weeks, they remain much higher than they were a year or even a few months ago. On Friday, AAA reported an average gas price of $3.90 in Mississippi, a 50% increase from the same period in 2021.

This increase in fuel costs doesn’t just affect the average resident filling up their car; it also throws a wrench into government operations in northeast Mississippi, from police patrols and fire departments to school and city infrastructure projects.

Big yellow gas guzzlers

Tupelo Public School District buses travel 75 routes daily to pick up and drop off students, as well as any buses used for field trips and other activities.

All those miles on the road add up. The week of February 8, 2021, the district spent $7,328 on fuel to transport children to and from school. That same week this year cost TPSD $11,159. That’s a 52% increase.

March was even more dramatic. The week of March 8, 2021, the district spent $7,603 on fuel. This time this year, the district spent $15,246, an increase of 100%.

Since the week of October 11, 2021, the school district’s weekly daily transportation cost has increased by more than 61%.

Rachel Murphree, TPSD’s chief financial officer, said the district has budgeted enough money this fiscal year to cover excess fuel costs, though school officials are monitoring spending.

To date, rising gas prices have not forced the district to cancel any excursions or sports trips.

“Fortunately, we have a very strong fund balance that can take care of us until the economy recovers,” Murphree added.

However, Murphree said the district will need to budget significantly more money — likely 50% to 75% more — for fuel in the upcoming 2022-23 school year.

Similarly, the Lee County School District’s monthly fuel expenses have doubled since 2021.

The district spent $9,600 per week on fuel in February 2021, up from $16,000 in February 2022. That’s a 66% year-over-year increase.

As of mid-October 2021, schools in Lee County have spent $12,500 on fuel. By the week of March 13, the cost had risen to $17,500, an increase of 40% in about five months.

Michael Martin, commercial director of LCSD, said district budgets are high and revenues are low to provide a cushion, particularly for fuel prices, as prices are likely to rise.

Money budgeted for fuel that is not used each year is carried over to the next year, so the district has accumulated a surplus to carry it through the end of the year.

The district will continue to operate its 102 scheduled bus routes per day, and LCSD Superintendent Coke Magee said fuel prices will not affect field trips, sports or activities for the 2021 school year. -22.

Next year, however, might be a different story.

“If we have a full year, next year, at these prices, it could eat away at the fund balance a bit more,” he said.

From hot mix to patrol cars

Kim Hanna, chief financial officer for the city of Tupelo, said the city was already looking for cost-cutting measures in anticipation of additional fuel expenses when gas prices spiked in late February and early March.

With gasoline prices already climbing even before the surge, Hanna said departments cut spending to make room in their budgets for additional fuel expenses.

Still, Hanna expects rising gas prices to hit the city’s budget hard, especially for services like police, fire, public works and sanitation, all of which require travel. regular.

For example, the Tupelo Police Department used approximately 9,000 gallons of gasoline each month between October 2020 and February 2021. All of those trips cost city ratepayers an average of $23,423 per month.

Hanna expects the average monthly fuel bill to rise significantly once the department releases its March report.

Not that there’s much to be done about the amount of police traveling every day, Hanna said. They keep patrolling the city.

Still, there are ways for police, fire and other public works departments to cut costs, and city officials are currently exploring those options.

It’s a similar situation out of town in Lee County. County Administrator Bill Benson also sees rising fuel costs as an issue that requires an overhaul of budgets.

Although Benson said he saw signs that gas prices could rise as he built the budget for this fiscal year, he said there was no way to anticipate how much the cost would increase.

“It hasn’t destroyed budgets yet, but over time it can happen,” Benson said. “We certainly didn’t budget for $4 a gallon. We really had no way of predicting it. Nobody expected (the invasion of Russia) on October 1 when we were approving the budgets.

Benson said the county sheriff’s office and the highways department see the most regular trips and would therefore be the hardest hit by rising fuel prices.

This impact is already visible. According to Benson, the Lee County Sheriff’s Office spent $177,045 on fuel last fiscal year; in the first six months of the current fiscal year, they spent $111,362, or 63% of what they spent in the previous year.

March of last year cost the county $13,307 to fund travel for the sheriff’s office. This March was slightly higher – $14,839 – but not as big as it could have been.

Benson said the full impact of rising gas will become more evident over the coming months.

But it’s not just the cost at the pump that could potentially hurt county and city coffers. Rising fuel costs affect the budgets of almost every project. Both Benson and Hanna noted that while projects and contractors have flexible budgets for gas, that will always play a role in what can be done on existing and future projects.

“Our hot mix bid was $72 a tonne last year, and now we’re talking at least $20 more,” Benson said. “It’s not just gasoline, but also asphalt products that are on the rise.”

wait and watch

While gas prices are an immediate issue, Hanna said the city won’t know how much pain the rising cost of fuel will inflict until the city’s sales tax refunds are released. later this spring.

“We’ll have to wait until May before we know the impact of the spike,” she said. “We don’t want to react drastically. We will not make drastic cuts in our services. »

If soaring fuel prices were to cause the city’s budget to go over, a likely scenario, Hanna said city officials would have to change the budget and, possibly, adjust their plans.

Lee County School District officials have taken a similar wait-and-see approach, at least for now.

As the 2021-2022 school year draws to a close, Martin is already eyeing next year’s budget. But with the district not yet knowing its funding level for the 2022-23 school year, it’s still too early to know how much of a problem rising gas prices might be.

“We don’t budget $600,000 for fuel every year,” Martin said. “If prices are still where they are and not expected to fall over the next year, then we will have to look at that much more carefully.”

Melissa C. Keyes