Low gasoline prices fuel savings for Indiana cities, counties

As area entities prepare fuel budgets for next year, several governments will get money back thanks to savings from lower gas prices this year. But budget estimates for departments like police, fire and street show leaders expect possible price rebounds over the coming months.

The average price for a gallon of unleaded gasoline in Fort Wayne was $1.87 as of Tuesday, according to Gasbuddy.com. The fuel price tracking site shows prices have fallen about 37 percent from a high of $2.97 a gallon in August.

For 2016, the city of Fort Wayne budgeted a 23 percent decrease, or $671,145, from 2015 in fuel-related line items for the police, fire, street, parks and recreation, traffic, animal care and control, public works and community development departments.

The city plans to spend nearly $1.5 million on using about 750,000 gallons of unleaded gas in 2016, said Purchasing Director Steve Gillette.

The police department commands a vast share of the gas funds budgeted for 2016, with $1.09 million for its vehicles, followed by the parks department at $139,000 and the fire department at nearly $70,000, according to estimates on Indiana Gateway for Government Units website.

Budget estimates also call for spending about $700,000 on diesel fuel and fuel oil, with the majority of that amount, $425,000, for the street department, followed by nearly $136,000 for the parks department and about $119,000 for the fire department.

Ag Plus Inc. in New Haven will supply roughly half the diesel at $2.18 a gallon through a contract the city locked in with the company. The other half would be purchased at market pricing, Gillette said.

The unleaded gas will come from a contract with Lassus Brothers Oil Inc., with the per-gallon price locked in at about $1.99.

While that price is higher than current gas prices, the move was made when the 2016 budget calculations began last summer as prices hovered around the $3-a-gallon mark. The lock helps the city in case prices shoot back up again.

“It protects the budget,” Gillette said. “It takes any and all risk out of the budget.”

Allen County plans to spend about $445,000 on gas for police and about $600,000 on gas and oil for the county highway department in 2016, or about $255,000 less than what was set for 2015, estimates show.

Fuel strategy

Each county and community budgets for fuel a little differently, depending on various factors, including how fuel is purchased.

Some, like Huntington and Wells counties and the cities of Huntington and Angola, expect to get back thousands of dollars from departments coming in under budget on gas.

Angola has saved about $54,000 so far this year after budgeting for $120,000 in fuel costs citywide, said Deb Twitchell, clerk-treasurer.

The sheriff’s departments in Huntington and Wells counties plan to return about $50,000 to their respective counties this year due to gas savings, they said.

Both departments each had $100,000 approved for fuel in 2015. Wells County Sheriff Monty Fisher credits lower gas prices and the use of more fuel-efficient cars for helping reduce costs. He sought $90,000 for fuel in 2016 as a result of the savings, but he is concerned about future price hikes.

“We’re hoping gas prices stay this way forever, but that’s not going to happen,” Fisher said.

Huntington County Sheriff Terry Stoffel budgeted $100,000 again for 2016 in anticipation of spending the same set price of $2.05 per gallon, while adding a new officer and a new car to the department on top of that.

Huntington County is among the counties, cities and towns that prefer to lock in fuel prices each year.

“I don’t gamble. I don’t have a crystal ball,” said Huntington County Commissioner Tom Wall. “We just hope the fuel comes in with the vendors at a rate that’s good for everyone involved.”

County officials bid out fuel costs to suppliers and negotiate with them for the entire county. The city of Huntington gets its gas from the county through a cooperative agreement.

While the city ended up with about $37,000 left over in gas money budgeted for police, fire and streets through November, it plans to increase the budgets for police and street services next year, said Christi Scher, Huntington clerk-treasurer.

Several communities, including Columbia City, Decatur and Kendallville, opt to pay for fuel through an on-demand system based on market prices at the time of purchase.

Adams County, which opened up bids for fuel suppliers on Dec. 7, doesn’t expect any big price swings next year.

“We’re looking for prices to steady,” said Lonnie Caffee of the county’s highway department. “Without having a bunch of snow, that’s saving us a bunch of money.”

Kosciusko County and Angola recently switched away from locking in prices and are now “letting it ride,” as Twitchell put it.

Gas is purchased from gas stations, but local governments get breaks from paying road and sales taxes on the gas. That method worked out well for the city this year as gas prices plunged, Twitchell said.

The cities and towns of Auburn, Kendallville and LaGrange, along with Adams, DeKalb, Noble, Steuben, Wabash and Whitley counties, will either keep fuel budgets the same or make some changes in individual departments next year.