05/08/06 — Schools feel pinch of high gas prices

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Schools feel pinch of high gas prices

By Phyllis Moore
Published in News on May 8, 2006 1:51 PM

The fuel provider for school systems across the state has decided not to renew his contract, leaving Wayne County Public Schools officials scrambling to find their own suppliers.

As a result, the school system is readying to make whatever budget adjustments are necessary to continue business as usual, said Raymond Smith, director of transportation for the school district.

"We are paying more for fuel now than we were paying during the crisis down in Louisiana after the hurricane because the state no longer has a contract that we can piggyback on, and additional taxes have been levied that we have no control over," he said.

Until last month, the contract locked school systems into a fixed rate for fuel, protecting them from rising costs and additional taxes, Smith said.

"We just received notification from the state that the state contractor that we had for fuel has opted out of the contract because the state would not allow them to increase the rates," he said.

As a result, school systems will now have to pay the going rate, which includes costs that are passed on by vendors, such as an "oil spill tax," Smith said.

"Other agencies that govern fuel spills and such are requiring these contractors to take out additional insurance, and they're passing on those services to us," he said.

In the past, he said, school systems were protected by the contractual agreement.

"When the vendors attempted to amend the contract, the state was able to protect us, but when the vendor opted out, we had no more control," he said.

Smith said the school system has written the state, asking for some relief. The state has not been able to comply, he said, because officials have no control over the taxation of fuel.

So, it is business as usual, with the school system maintaining its regular schedule as far as transportation is concerned, Smith said.

"We have not curtailed any field trips or athletic activities to-date, mainly because there's no fuel shortage, just high costs," he said.

There is a contingency plan, first introduced soon after Hurricane Katrina struck, Smith said.

"We're prepared to do the same thing we did during the disaster," he said. "We convened with the superintendent and assistant superintendent for auxiliary services (Sprunt Hill), and we were able to develop a cutback program. There are measures in place that if we need to cut back, we're prepared to do so."

The plan, which includes cutting back on field trips, business travel and athletic events, can be implemented at a moment's notice, Smith said. While the former restrictions were imposed by the state, he said the local school system has the power to decide if such a move is necessary.

The effect of fuel costs on the school system's budget is a concern officials are studying, he added.

"Currently, we have to make adjustments in other budget line items that have allowed us to maintain the regular transportation activities. We have been very fortunate this year. Kudos to the finance department and other departments within the school system," he said. "But at the same time, we're hopeful that the Department of Public Instruction and the state of North Carolina's legislators are prepared to make additional appropriations to fund this."

The only bright spot at this point is that summer is approaching.

"During the summer, we're able to park the school buses and many of the activity buses. So we are looking for some relief to fuel spending over the summer," he said.