Gas costs may lead to pricey transit contracts

As area gas prices continue to soar, some residents feel a pinch in their wallets and government services brace for possible budgeting changes.

According to GasBuddy.com, gas prices in the area have jumped to about $3.63 on April 3 from about $3 on Jan. 3.

The latest spike in gas prices was seen from the last week of February to early March, as conflict in Libya came to a head.

“There’s not much you can do about it,” said Ted Smith, buying gas Sunday at the WilcoHess station on Martin Luther King Jr. Boulevard. He added many people with whom he works have begun carpooling.

If gas prices continue to rise, Chapel Hill Transit could see higher expenses in negotiating a fuel contract.

Chapel Hill Transit is under a year-long contract with Richmond-based James River Petroleum, which locks in their price at $2.45 per gallon of diesel, which is currently priced as high as $3.95 in Chapel Hill.

The contract expires in June, and town officials will enter another contract depending on which company offers the best deal, said Brian Litchfield, assistant transit director for Chapel Hill Transit..

“The cost of diesel fuel is one of the largest items on our budget,” Litchfield said. “We use about 600,000 gallons of diesel every year. It’s a significant cost to what we do.”

Both Chapel Hill Transit and the buses for Orange County Schools have contracts with fuel companies to keep their fuel prices at a fixed price for the duration of the contract.

Orange County Schools spokesman Michael Gilbert said prices have yet to affect busing.

He said if the prices continue to go up, it could start affecting the district’s budget.

“We don’t know exactly what we’re looking at yet,” Gilbert said.

Litchfield said there has not been a large increase in ridership with increased gas prices. However, there has been a slight rise in traffic from park-and-ride lots, he said.

Ridership for the area is already high; so, Chapel Hill typically doesn’t see increases as high as other areas, he said.

“We carry more riders than any other system already,” he said. “There’s room for more.”

He said he expects to see an increase if gas prices continue to go up. The general trend is ridership only increases after months of high prices people no longer want to pay.

“Our ridership tends to lag behind fuel prices,” Litchfield said.

Chapel Hill resident Stephen Piskor said as gas prices keep rising, motorists should look at the long-term problem.

“Until this country decides to end its dependence on oil, this is what you get,” Piskor said. “In the long term people have to think, ‘Is there another way to do this?’”

But for some residents, alternatives to driving don’t always exist.

Joe Long, Quate Industrial Service employee, said driving is a part of his job. He said he has no choice but to pay — even if it means making less money.

“We have to do what we need to do,” Long said. “You have to make sacrifices at the grocery store to be able to get gas.”

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