Oregon State Agencies Begin to Address Hidden Costs of High Fuel Prices – Oregon Capital Chronicle
Gasoline is both the giving hand and the taking hand at the Oregon Department of Transportation. For its funding, the agency relies on taxes collected on gas sales at the state level. To power road crews, mowers, and snow plows, he must buy about three million gallons of gasoline and diesel a year.
When prices are high, the department struggles to afford its own fuel, and Oregon drivers, who pay gas tax at the pump, end up driving less and buying less gas. which reduces the revenue of the department.
It’s one of the many quiet ways that rising fuel prices are impacting state agencies that still rely on combustion engines and must travel many miles to do their jobs.
Mac Lynde is an operations administrator in the transportation department.
“Costs are rising exponentially right now with pandemic-related supply chain issues and asphalt prices will rise with oil. It will force us to make some tough decisions,” Lynde said. “That could mean less pavement, less weather seals on rural roads, less major maintenance work that we do.”
The average price of a gallon of regular gas for Oregonians hit $4.74 on Friday, according to Oregon AAA. That’s 70 cents more than the previous week and $2 more than a year ago.
The recent spike is due to the Russian invasion of Ukraine, which has disrupted global oil trade and supply chains and is likely to keep gas prices high, according to economists.
The Oregon Department of Administrative Services negotiates a reduced bulk fuel rate for state agencies, and employees refuel at specific bulk fuel sites.
For a gallon of regular fuel right now, bulk fuel users pay about $1 less per gallon than retail, and for diesel about $1.20 less per gallon. Still, prices have soared by more than a third in the past month, and the Administrative Services Department expects them to rise another 50 cents next week.
When government employees are not near a bulk fuel site, they pay the retail price like everyone else.
The Department of Transportation expects that at current prices, it could end up paying $3.5 million more for fuel next year.
Andrea Chiapella, director of communications in the Department of Administrative Services, wrote via email that agencies receiving the bulk fuel tariff should make do with the budgets they currently have until 2023. Agencies can contact the services officials for emergency fuel budget adjustments, but he hasn’t heard from anyone yet.
“It may be too early to tell,” Chiapella wrote.
Department of Fish and Wildlife
The state Department of Fish and Wildlife relies on trucks, all-terrain vehicles and boats to do its job, and it also faces inconspicuous costs if gasoline prices rise.
Fish and Wildlife derives most of its money not from the state’s general fund, but from the sale of hunting and fishing licenses.
According to Shannon Hurn, assistant executive director of Fish and Wildlife, when gasoline prices rise, fewer of these licenses are sold.
It could determine if we go into the field as much, it could delay hiring, the purchase of equipment.
– Shannon Hurn, Deputy Executive Director, Oregon Department of Fish and Wildlife
In 2008, when gasoline prices reached their last record high – an average of $4.11 per gallon – the ministry conducted an economic impact analysis.
“Most of our funding comes from participating in wildlife-consuming activities,” Hurn said. “We found that participation in these activities is related to the price of gas, not the cost of licenses.”
Hurn said the department looks to 2008 as a model for how to handle budget shortfalls it anticipates in the coming months.
The 2008 outbreak forced the agency to restrict travel across the state, halt employee trainings and suspend some habitat restoration projects.
“It could determine if we go out into the field that much, it could delay hiring, buying equipment,” Hurn said.
Fish and Wildlife receives federal funding, so more of it could help balance the losses, but even that is tied to federal excise taxes on the sale of, among other things, gasoline.
“Rebuilding a fishway structure is $1 million,” Hurn said. “We have contractors who cover great distances. The costs of these restoration works will be inflated.
She expects long-term research and habitat restoration projects to be shelved in order to save money. The department cannot afford to cut its budget to deal with emergencies, such as managing animal and wildlife encounters.
“When people think about wildlife management, I don’t know if they realize that there really is a lot to do. We do surveys, research, manage fish harvests, but our work also focuses on picking up sick and injured animals, helping private landowners. Got a cougar in downtown Portland? You have to be available. »
Since Fish and Wildlife does not receive money from the state’s general fund, it does not have many options for applying for emergency funding.
“We don’t have the opportunity to change money. We cannot go to the Legislative Assembly and ask for additional funds through the emergency board,” Hurn said.
For now, it’s likely that on a project-by-project basis, teams within the agency will have to find a way to balance the budgets they already have through 2023.
“If projects run out of money, they won’t be able to restart until 2023 when they have a newly enacted budget,” Hurn said.
Oregon State Police
According to Mindy McCartt, director of communications for the Oregon State Police, state police employees travel more than a million miles a month, but she could not provide any information on how which the agency faces current fuel costs and increases that may occur.
McCartt said any adjustments to the department’s $4.9 million two-year fuel budget will be a “waiting game.”
The agency is halfway through its budget cycle and has time to adjust based on the impact it will have on gas prices. If prices stay above $4 a gallon for next year, McCartt said, the agency will need to double its fuel budget to at least $8 million for the next biennium.
Because the agency gets most of its funding from the state’s general fund, McCartt said it can apply for emergency funds through the state Emergency Board.
Get out of gasoline
For the Department of Transportation, planning for a gasoline-free future has been a long time coming.
Shelley Snow, the department’s communications director, said he had been pushing for more than 20 years to come up with a plan.
“We’ve spoken earnestly to every legislature since 1999 about this, saying, ‘Hey, in the future there’s going to be a lot of electric vehicles on the roads and vehicles that get high mileage per gallon. Since we make our money from a tax on every gallon of gasoline sold, we need to start thinking about it,” she said.
Currently, EV owners can opt into a program that taxes them based on their mileage, measured by a plugin they put in their car, and the money goes to the Department of Transportation. Snow said it’s likely this will have to be a requirement in all electric cars in the future in order to fund the Transportation Department.
We currently have electric van orders that cannot be fulfilled. We would like to move faster, but the reality is that today’s market is focused on individual consumers and less on full fleets.
– Mac Lynde, Operations Administrator, Oregon Department of Transportation
The Department of Transportation and Fish and Wildlife want to electrify their fleets as soon as possible, but shortages of electric trucks caused by supply chain issues mean it could be years before either no other agency gets even a dozen or more of these vehicles.
Fish and Wildlife currently has about 1,300 employees and 650 vehicles in its fleet, and it typically borrows another 80 to 100 from the administrative services department to use for surveys during the summer, their busiest time of year.
Hurn said the Administrative Services Department had about five electric trucks to loan, but they weren’t well equipped to handle the remote projects Fish and Wildlife was working on due to a lack of charging stations throughout the city. ‘State.
The Department of Transport also hopes to get electrified fleets in the future, but the supply just isn’t there.
“We currently have orders for electric vans that cannot be fulfilled,” said Lynde, the department’s operations administrator.
“We would like to move faster, but the reality is that the current market is for individual consumers and less for full fleets,” he said.
On the bright side, when fuel prices rise, more people tend to use public transit. The Ministère des Transports predicts that, as in 2008, ridership will increase on trains and buses. But, as in the years since 2008, Lynde expects the impacts of high fuel prices to be felt for many years down the road.
“We probably never really catch up,” he said of the projects put on hold due to higher costs. “We are still managing a declining investment in what is needed.”