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Gas sits at $4.99 a gallon on June 16, 2022 at a Midland BP gas station.
MIDLAND — Residents have been feeling the weight of surging gas prices.
As of Thursday afternoon, AAA Auto Club has reported a Tri-Cities average of $5.127 for regular gas.
The Midland Daily News spoke with agencies and organizations in Midland County on how business is faring amid record-high fuel costs.
City of Midland Dial-A-Ride
“We are definitely feeling the effects of the fuel price increases,” said Dial-A-Ride Manager Amy Bidwell. “Luckily, we are not at our full pre-pandemic ridership yet.”
Services have been operating at about 90% of pre-pandemic levels. Bidwell said this has helped offset fuel costs, for now.
Next year, she said Dial-A-Ride is likely going to readjust its budget, mid-year, to accommodate for the increase in gasoline costs. She said an increase in one area of the general operating costs is likely to affect the three funding sources from federal to state to local governments. As of Wednesday, Bidwell said the shares go as follows:
She estimated the annual fuel costs could range from $150,000 to $200,000 in the next year.
In terms of the local share, Bidwell said costs are being monitored and the transportation service is incorporating increases into future planning and budgeting.
“We are definitely talking with the city and looking at what do we need to adjust or do differently as a result of these increased costs,” she said.
However, rider fares have yet to be adjusted, and Bidwell said she does not foresee adjustments relating to the services that Dial-A-Ride provides. Overall ridership consists of more than 70% seniors and persons with disabilities.
“Fares actually account for a very small part of our revenue,” she said. “People that use Dial-A-Ride (services) are typically people that may already be part of a disadvantaged community. We try to safeguard those cost increases as much as possible, because we know it’ll impact those folks the most.”
Bidwell said Dial-A-Ride has applied for funding with the hopes of obtaining two electric transit vans with the help of a federal grant program. By the end of summer, the local transportation service should have a better understanding of the potential low-emission vehicles.
“We’re looking ahead to the future and thinking that being able to diversify our fuel sources could help to alleviate the cost fluctuations we’re seeing in the industry,” she said.
Midland County Road Commission
Fuel costs are estimated to be up by about $50,000 for the last month, in comparison to a typical month of services provided by the Midland County Road Commission (MCRC).
When comparing the first six months of 2021 to the current prices, Road Commission Director Donna Lowe said diesel fuel costs have risen 42% and unleaded fuel costs have risen 36% for the first six months of 2022.
“Right now, we’re doing OK for the year, because we did anticipate the rise in costs,” Lowe said on Wednesday.
The State of Michigan supports maintenance, and locally, there is a road millage supported by taxpayers. Lowe said the commission does not currently plan to adjust its budget in the immediate future.
“Our hope is that the community wouldn’t even see an impact,” she said. “We just try to use our funds as wisely as possible.”
Nonprofit Senior Services
Senior Services of Midland says it is the only organization in Midland County providing the wide array of services needed to help people age “where they want to be: in their home.”
The nonprofit is able to do this by having drivers, both volunteer and paid, travel to Midland residents’ given location. In general, Executive Director Charlie Schwedler said Senior Services is “always short of drivers,” and not necessarily due to the fuel hikes.
While driver numbers are down in general, the gas prices have made an impact on how many drivers show up each day. Some drivers are driving more routes than preferred, just to ensure that those receiving services are well supported.
“Our volunteers are so incredible that frankly, they’re just keeping on keeping on,” he said.
“It’s a burden on a lot of our employees as well,” Schwedler later added. “We’re nonprofit, so it’s not like people are making a fortune working here. I worry about gas prices for our employees, getting to and from work.”
The only recent budget reductions at Senior Services have been made due to COVID-19, he said. Senior Services briefly closed during the pandemic.
In terms of external support, Schwedler said the federal government just increased the gas reimbursement cost to 62.5 cents per mile. Locally, Midland County residents contribute just under 60% of the Senior Services budget.
“There are specific dollars that are used to defray those costs, either through state and federal grants, through the United Way or through millage dollars,” he said.
One of the Senior Services programs, Meals On Wheels, serves around 700 eligible clients year-round. In terms of this service, Schwedler said if a client is participating in Meals On Wheels, “they’re going to be checked, because they’re checked on every single day.”
Midland County Sheriff’s Office
While other sheriff’s offices in the region have been navigating challenges with the fuel prices, the Midland County Sheriff’s Office has confirmed that it is able to continue operations per usual.
In terms of facing the fuel hikes, Mark Bone, chair of the County of Midland board of commissioners, told the Daily News last week that the county would help the Sheriff’s Office with fuel costs as needed.
County Connection did not return calls from the Midland Daily News in time for publication.
General look at costs: What is happening?
Some blame President Joe Biden for the high gas prices. Others say it’s because Russian President Vladimir Putin recklessly invaded Ukraine. It’s not hard to find people, including Democrats in Congress, who accuse the oil companies of price gouging.
Gasoline prices have been surging since April 2020, after the initial shock of the pandemic drove prices down to below $1.80 a gallon, according to government figures. They hit $3.00 a gallon in May 2021 and cruised past $4.00 in March 2022.
State averages ranged from $6.43 a gallon in California to $4.52 in Mississippi as of June 11.
AAA auto club reports Michigan’s average rose to $5.21, as of Wednesday.
Who is hurting?
Higher energy prices hit lower-income families the hardest. Workers in retail and the fast-food industry can’t work from home – they must commute by car or public transportation.
The National Energy Assistance Directors Association estimates that the 20% of families with the lowest income could be spending 38% of their income on energy including gasoline this year, up from 27% in 2020.
When will it end?
It could be up to motorists themselves – by driving less, they would reduce demand and put downward pressure on prices.
“There has got to be some point where people start cutting back, I just don’t know what the magic point is,” said Patrick De Haan, an analyst for the gas-shopping app GasBuddy. “Is it going to be $5? Is it going to be $6, or $7? That’s the million-dollar question that nobody knows.”
Why is this happening?
Several factors are coming together to push gasoline prices higher.
Global oil prices have been rising — unevenly, but sharply overall — since December. The price of international crude oil has roughly doubled in that time, with the U.S. benchmark rising nearly as much, closing Friday at more than $120 a barrel.
Russia’s invasion of Ukraine and the resulting sanctions by the United States and its allies have contributed to the rise in gas prices. Russia is a leading oil producer. The United States is the world’s largest oil producer, but U.S. capacity to turn oil into gasoline is down 900,000 barrels of oil per day since the end of 2019, according to the Energy Department.
Tighter oil and gasoline supplies are hitting as energy consumption rises because of the economic recovery.
Finally, Americans typically drive more starting around Memorial Day, adding to the current high demand for gasoline.
Julie Walker in Brooklyn, New York, contributed to this report.
Tess DeGayner is a reporter for the Midland Daily News. She joined the Daily News after studying journalism and broadcasting at Central Michigan University. DeGayner graduated with a bachelor’s degree in 2021. She previously reported for WCMU Public Radio, the Traverse City Record-Eagle and the Tri-County Times – her hometown newspaper in Fenton, Michigan.
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