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Buses shrug off price hikes

BY ERIN MARSHALL | JULY 07, 2014 5:00 AM

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Rising prices are problematic, but local public-transportation systems have discovered ways to cope and adjust their budgets.

Iowa has a lower combined gas tax than many other states; Iowans pay 40.4 cents per gallon in federal and state gas taxes.

“January through June of 2014 represent the lowest [gas-price] numbers we’ve seen in the last four years,” said Gregg Laskoski, a senior petroleum analyst with GasBuddy.com.

For the first half of 2014, the average national gas price was $3.52 a gallon. In 2013, it was $3.57 a gallon, and in 2012, it was $3.64 a gallon.

Even major travel holidays do not necessarily cause spikes in gas prices. Instead, the weather conditions play a key role in determining whether people will travel and thus whether prices at the pump will rise.

“There have been some travel holidays that we’ve seen gas prices stay flat,” Laskoski said. “It’s not automatic that you’re going to see a sharp spike.”

Iowa residents are not the only ones affected by increased prices. The University of Iowa’s Cambus system also takes the price into account.

“Gas prices are a very significant operating expense for Cambus,” Cambus manager Brian McClatchey said.

The cost of fuel used to be 10 percent of the Cambus operating budget. Today, it is more than 20 percent, McClatchey said. Cambus uses approximately 215,000 gallons of biodiesel per year.

Yet Cambus is used to budgeting for fuel costs. The fleet service manager estimates fuel prices for the year and the service budgets accordingly, McClatchey said.

“We’ve had to look at our expenditures and revenues and make an adjustment to that over time,” he said.

Local bus systems have also not made adjustments due to the recent spike.

“Our price for diesel fuel has not fluctuated much over the last few months, hovering in the $3.16 per gallon, which is about 4 cents below the yearly average,” Chris O’Brien, the Iowa City Transportation services director, wrote in an email.

The Iowa City Transit System has thus been able to absorb minor increases, O’Brien said.

Vicky Robrock, the Coralville director of parking and transportation, said that with increased gas prices, the use of public transportation has gone up.

“Fuel is a significant portion of our budget and is very difficult to anticipate due to its volatile nature,” she said. “We budget using the best information available at the time and using historical data. Inevitably, fuel prices can significantly affect other line items in our budget.”


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