Costs are up, revenue is down as local highway bosses try to plan for winter

NORWALK County officials are getting a little salty as they plan for Old Man Winter's return.
Cory Frolik
May 24, 2010

NORWALK

County officials are getting a little salty as they plan for Old Man Winter’s return.

Salt prices are up, gas tax revenues are down, road work costs are up and counties are left scrambling to find ways to keep motorists safe.

Most of the woe can be attributed to higher gas prices, something over which local officials have no control. That leads to frustration as bids for road salt start to trickle in.

“The price is going nuts,” said Ottawa County engineer David Brunkhorst. “We’re trying to figure out budgetarily what we are going to do.”

Brunkhorst said he heard from the Fulton County engineer this week that the county west of Toledo paid $42.27 per ton of salt last year and were quoted up to $76.48 per ton this year.

Ottawa County doesn’t go out for bid on salt until September, but county officials are counting on having to pay double what they paid last year. They’re considering additives and finding other ways to stretch the salt they are able to purchase.

“Our first intent is to have roads safe for drivers,” Brunkhorst said.

When opening bids last week, Huron County saw the largest single jump in the price of road salt since the Huron County Engineer’s office started keeping records many years ago.

Last year the county purchased 4,000 tons of road salt at $40 per ton. Bids reveal the cost will be at least $49 per ton this year.

“I don’t know how some of these little communities are going to be able to adjust for that kind of a pricing increase,” said Huron County assistant engineer Carl Essex. “Nobody has an extra $100,000 to $200,000 laying around.”

Erie County Engineer Jack Farschman said the county budgeted $116,550 to purchase 31,050 tons of salt this year. He said county leaders will have to regroup if the cost has increased as much as anticipated. The county seeks its bids for salt at the end of this month.

“Prices are rising while revenues are falling,” he said. “We have to work with what’s left. When that happens, you have to make some hard decisions.”

Joseph Wojtonik, spokesman for the Morton Salt Co., said price increases are due to an increase in the cost of production and in demand.

“There were shortages resulting from severe weather last winter,” he said, adding that his company is still building stockpiles for the coming winter.

George Davis, spokesman for the Detroit Salt Co., said the cost of production is up because of the price of fuel and echoed Wojtonik’s comments about shortages.

Expensive salt is not the only financial concern to highway departments. Anticipating a decline in gas tax revenue in coming months, Huron County engineer Joseph Kovach said the roads may suffer.

Through June, the gas tax distributed to all 88 counties was actually up from last year, though that’s not expected to be a trend.

The amount distributed to each county from January to June was $1,192,469, an increase of about $51,000 from last year, said Dennis Stieber, Huron County deputy auditor. During the same period in 2007, each county received $1,140,886, local auditors report.  

The amount of gas tax collected and then distributed to all the counties does not reflect the price of fuel. The gas tax is set at 28 cents per gallon, said Mike McKinney, spokesman for the Ohio Department of Taxation. It does not fluctuate based on oil prices.

Gas tax money can only be used to pay for the construction, reconstruction, maintenance or improvement of the state’s highways. While more gas tax equates to more money in each county’s highway fund, the extra $51,000 is not going to make much of a difference as the cost of asphalt and reinforced steel head in the same direction as road salt.

“That $50,000 was eaten up in the first order that we placed for paving this year,” Essex said.

Kovach said construction material costs are up by about 14 percent.

He said he anticipates that gas tax money the county receives will decrease in coming months. He said the funding counties receive lags about four months behind when they were collected. The county only recently received revenues collected in March.

“We are anticipating a 3 to 5 percent decrease in gas tax revenues as the state begins to send out the gas tax received as the cost of gas began to seriously jump in April,” he said.