Highway Departmentt May Get Creative As Asphalt Costs Balloon

By John Voket

The rising cost of petroleum-based asphalt is mirroring the trend consumers are seeing at the pumps. And the Newtown Highway Department may have to get creative to ensure the most critical road replacement and repair plans stay on track this summer.

According to Public Works Director Fred Hurley, his department has actually been issued a double hit. Besides a 25 percent increase in the cost of asphalt — from $60 to $85 per ton in just the past few weeks — the cost of catch basins that are an integral part of road projects have nearly doubled.

This is due to increasing costs of steel used to make rebar reinforcements in the concrete structures, he explained.

“Asphalt cost went up so much that state bids [for the commodity] were cancelled,” Mr Hurley told The Bee this week. “And our vendor just called Tuesday saying he may not be able to honor the bid prices for the catch basins we ordered.”

Mr Hurley said that each season, the state sets the per ton price for asphalt that its crews and local highway workers put down.

“That number is used to piggyback on state bids,” Mr Hurley said. “In simple terms, last summer it cost us $60,000 for every 1,000 tons of asphalt. This year the same 1,000 tons would cost $85,000. We may be in a situation where we are looking at how many tons we can get and stay within budget. We certainly can’t increase spending.”

This is where the creative “application” comes in. Mr Hurley said his department may consider reducing the overall seasonal project scope by phasing, or working on the worst sections of planned projects this year and finishing the less critical sections of the same roads next summer instead of just cutting entire roads from the roster.

“I’m not ready to cut specific roads yet,” Mr Hurley said, adding that he is just beginning to juggle the projected jobs while factoring in the price increases for asphalt and the catch basins. “I’m hoping [over time] some of this breaks. But we will still be doing priority and emergency work.”

The highway department keeps a surplus of sand, stone, catch basins, and other supplies in inventory at all times in the event of a developing emergency.

Mr Hurley said there are other vendors who are beginning to add surcharges to deliveries, including fuel.

He said he is already dealing with increases for treated road salt for the winter, which has increased from $60 to $85 per ton largely on the increased cost to transport the ice melting compound.

“We’re expecting to get a call any day now whacking us for plastic pipe because it’s made of…guess what? Petroleum. We’re definitely in a situation where we will have to adapt our construction [plans] to a changing cost environment.”

Ironically, however, in the area of actual fuel costs, Mr Hurley is enjoying a windfall as a result of locking shockingly low supply prices for diesel fuel and gasoline. While truckers and consumers are paying upwards of $5 per gallon for diesel at the pump this week, the town had been paying just $2.09 — not a typo — and the new bulk bid for the coming year has only escalated to $3.07.

His department has also negotiated a price of $2.67 for gasoline, a rate that he said is good through December 31, 2008.