Local and state officials agree – high prices at the pump now can have an effect on the future.

Friday, May 18, 2001

Local and state officials agree – high prices at the pump now can have an effect on the future. Local and state government agencies prepare their budget in advance. With the rapid inflation of gas prices, some government officials are keeping a watchful eye on the potential ripple-effect the high prices can have on future projects.

Some agencies provided for higher gas prices but inflated prices at the pump have exceeded the amount they expected. Ironton mayor Bob Cleary said the city budgeted for an increase in gas cost and allocated money in the budget but the gas prices raised more than the city expected. Cleary said "anytime gas prices are high, we feel the impact in the budget."

In order to ease the burden on the city’s coffers, city employees are bargain shopping for gasoline. Cleary said the city isn’t "locked in" to a particular fuel company and can choose the fuel company offering the best rate. Cleary said, "We send our vehicles to the place with the best deal."

County Engineer David Lynn said the cost of gas and the cost of petroleum-based products is causing some concern in his office. Lynn said the increased gas price can affect the amount of revenue in his office.

Lynn explained the Engineer’s office is funded in part from the Ohio gas tax. He said about 40 percent of his office’s budget come from the tax, receiving 2-cents from every gallon of gas sold. He said, "when gas prices are up, people tend to drive less." The economic principle is simple, explained Lynn. When people start driving fewer miles, they buy less gas. The less gas sold equals fewer tax dollars generated which, in turn, equals fewer dollars received by the county engineer’s office.

Another crunch felt by the county engineer’s office is the increased price of petroleum-based products such as asphalt. Lynn said the cost of asphalt itself has increased, as well as, the cost of transporting the construction materials to the work site. Lynn said at this point, the increase in construction cost is about what his office had estimated and the increased cost "has not had a tremendous impact, yet."

"We haven’t seen the impact yet," Lynn said. "We will see the affect at the end of the year."

Kathleen Fuller, the spokesperson for District 9 of the Ohio Department of Transportation in Chillicothe said the state is "very well aware of the increased gas prices…we’re consumers, too."

Fuller said the state is keeping a watchful eye on the gas prices and state officials are analyzing the numbers and are keeping watch on the trends. She said although the increased gas prices now may have an impact on the future, the state highway department will continue projects. She said the district is not making cutbacks in projects but, she said, the state is definitely aware of the situation.

She said the price of asphalt is a "real concern for us." She said the increased gas prices is both "snowballing and cyclical." She said the state highway department receives money from gas taxes and feels the same economical crunch discussed by Lynn.

As gas prices increase, government officials have all agreed their agencies will be keeping an eye on inflation and analyzing the impact higher gas prices will have on the future.