Local Governments Band Together for 'Fuel In Bulk' Plan

A coalition of north Georgia cities and counties hopes to save money by buying fuel in bulk for its government cars.

It may be the first arrangement of its kind in the state. The 14 governments involved include several from metro Atlanta, and a handful in northeast Georgia, such as Jackson County.

The idea is to band together, and lock-in better prices on gas that will run the communities fleets of vehicles. Just last summer, the budgets of many local governments were stressed when fuel prices spiked to more than $4 a gallon.

Len Bernat is purchasing manager for Jackson County. He says his county benefits from the larger county government of Gwinnett leading this coalition:

"Our advantage is, we'll be able to piggy-back off that price. So I'm getting the advantage as if I had that same number of vehicles in my fleet and that same usage, without having to show that usage."

Individual local governments can opt-out of the arrangement if they find better deals on their own.

The co-op will consider bids from fuel distributors sometime next month. Projected fuel savings for the coalition as a whole could be nearly $1 million.

State leaders mull gas crisis solutions

Some 200 motorists lined up at a Kroger gas station in Marietta, Ga., on Sunday, Sept. 28, 2008. Scenes similar to this were common throughout the metro Atlanta area, as well as in other parts of the state in recent weeks. (Dave Bender)

Georgia leaders are debating whether to revise the state's emergency fuel plan and are considering ways to bolster gas supply in the aftermath of the abrupt shortage of gas that sent some motorists into a frenzy.

As lines outside gas stations grow shorter, frustrating searches for fuel have given way to soul-searching among Georgia legislators. Critics, meanwhile, have sharply condemned the state's response to the crisis.

The gas shortage started with the one-two punch of Hurricanes Gustav and Ike, which shut down refineries along the Gulf Coast. And the hankering among panicky drivers to top off their tanks when they passed an open fueled station made things worse.

Soon many gas stations around metro Atlanta were shuttered, and some lines outside those that stayed open could stretch for hours. Radio stations eagerly broadcast the names of open stations, and some drivers tailed fuel trucks in hopes of filling up their tanks.

Georgia's leaders updated an emergency plan last year to better handle a gas crisis. Among other options, the plan allows the governor to limit drivers to fill up their tanks every other day and set minimum and maximum limits on how much fuel they can purchase.

Gov. Sonny Perdue lobbied the Environmental Protection Agency to permit delivery of high-sulfur gasoline to metro Atlanta because the cleaner-burning low sulfur fuel normally required was in short supply.

But he ruled out more stringent options amid worries they would spark an even greater panic. Some of the measures proved too difficult to enforce while others weren't feasible, said Perdue spokesman Bert Brantley.

Gas retailers, for one, complained their pumps weren't equipped to set minimum fuel limits. And state officials were uncertain how they would enforce the every-other-day limits if they were enacted.

"You're looking at asking retailers to hire additional folks to be out there and try to enforce something like this," said Brantley. "And what do you do about the guy who's on empty, but it's not his day?"

Perdue, who returned Friday from a weeklong trade mission in Europe, has also taken heat from critics for the his absence in the middle of the fuel crisis.

"The governor should have gotten on MARTA to go to the Capitol as an example to use mass transit," said DuBose Porter, the House's top Democrat. "But he was in Spain, so it would be kind of difficult for him to lead by example."

Perdue's office countered that the governor was still calling the shots from abroad.

"This isn't the '50s where you'd go out of the country and not be reachable for a week," said Brantley. "He is incredibly reachable.

As the dust settles, the governor's office said it will consider several changes to the emergency gas plan, including a more structured policy to apply to the EPA for high-sulfur gasoline permits.

And state officials say they will explore ways to bolster supply of gas. Two pipelines that run from Houston through Georgia supply most of the state's gas, but officials sound eager to explore ways to ship in more fuel.

"There are some capacity issues and supply issues we want to look at in the future," said Shane Hix of the Georgia Environmental Facilities Authority. "We'll look at improving supply, including the diversity of supply from the port of Savannah."

House Speaker Glenn Richardson's office said he'll be looking at "various options" to prevent another crisis.

Legislators could also consider another effort to speed along the construction of a $2 billion pipeline that would stretch from Louisiana to Atlanta's suburbs. A bill to fast-track the construction failed in the Legislature last year, but the project is still moving forward.

Some say the state should have done more.

Democrats said the state should have warned the public about the tight gas supply sooner, and should have been quicker to implement anti-gouging protection. And Porter, the House leader, said legislators should dedicate more funding for alternative transportation by allowing a penny of the gas sales tax to fund mass transit.

"We're lucky it was a better case scenario, not a worst case scenario," Porter said. "But we weren't prepared either way."

Tom Smith, a finance professor at Emory University's Goizueta Business School, said legislators should tighten gouging rules and draft firm plans to take to the airwaves to soothe panicky residents and encourage them to telecommute amid the crisis.

"It's times like these where you have to give people incentives to behave in ways that are counterintuitive," said Tom Smith, a finance professor at Emory University's Goizueta Business School. "You have to convince them to buy less gas."

Some frustrated drivers simply wanted more of a warning.

Lining up at the pump in Marietta, on Sunday, Sept., 28, 2008. (Dave Bender)

Jack Brownfield, who passed 10 Atlanta gas stations this week before finally finding one with one fuel, said state officials should have done more to warn residents about Georgia's precarious gas supply.

"It was predictable," he said.

(The Associated Press)

Click here for more GPB News coverage of the gas crisis.

Sumter Co. schools to curb bus service

Sumter County School buses ferrying students to classes this fall will be making fewer stops, primarily to save on gas according to the Americus Times-Recorder.

The decision, by the Sumter County Board of Education, will affect students residing no more than one and a half miles from school. State law does not subsidize fuel costs up to that distance.

The familiar yellow buses will continue on the same routes, but will not stop at locations listed here.

Darien starting 4-day work week over fuel costs

The town of Darien on Georgia’s Atlantic coast is one of the first in the state to go over to a four-day work week, due to rising fuel prices.

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City Manager Brett Cook says the town's 2,400 residents has been hammered with a 48-percent increase in gas prices since 2006:

“Finances are a lot more difficult with the smaller budget, and we’re not a large city by any means, so a small increase in fuel on us would affect us a little bit more than a large city.”

Darien runs a fleet of almost 30 vehicles, including heavy trucks and machinery that run on diesel fuel.

Cook says he hopes the shorter work week will also benefit the city’s employees, many of whom live far from town.

Click here for more GPB News coverage of gas prices and their effect on Georgia.

Delta to cut more domestic flights

Delta is preparing to cut more flights. It plans to cut domestic capacity by an extra three percent in the second half of 2008, making a 13 percent overall cut by the end of the year. The Atlanta-based carrier estimates fuel costs will be $4 billion more than what they were last year.

The drive towards less driving

Brent Cranfield telecommutes from his home in Marietta, Ga., one day a week, saving 30 or 40 miles on his car once a week. (Stanley Leary, AP)

Brent Cranfield can thank his boss for saving him money at the pump.

With gas prices so high, Georgia House Speaker Glenn Richardson is letting staffers telecommute one day a week this summer. For Cranfield, who works in the communications office, that means one less trip each week in his Ford Explorer from suburban Marietta to downtown Atlanta and back — saving more than $25 a month on his 16- to 17-mile commute. Cranfield plans to use the savings to help buy a more fuel-efficient car:

"I'm actually waiting for the '09 Camrys to come out so I can try to grab an '08 and get some of that initial sticker price taken off of it."

Some employers are reconsidering the traditional five-days-in-the-office pattern as the national average price for a gallon of gas hovers around $4. The idea is to whittle down commuting costs for workers by allowing them to work from home or switch to four days of 10 hours each.

Then there are more recent gas spike-inspired experimenters — many of them public employers — like at the Georgia Capitol.

"With gas prices exceeding $3.50 a gallon and no end in sight to the increases I want to try and do something to help you with that burden," Richardson wrote in an April staff memo.

This week, the U.S. House of Representatives approved legislation requiring the head of each federal agency to set policies allowing qualified workers to work from home or another convenient location. Giving relief from high gas prices was one factor cited by the sponsor, Rep. Danny Davis, D-Ill.

Savings can add up fast. Santa Clara, Calif.-based Sun estimates that its more than 18,000 employees who can choose to work at home or the nearest office avoid buying 135 gallons of gas a year, which at $4 a gallon would save $540 each. Deborah Bryan, a program manager for IBM in Boulder, Colo., who switched to telecommuting in April, said she now spends $88 to fill up her Ford Expedition every third week, instead of weekly.

Millions of American workers cannot telecommute because they build houses, serve food, mow lawns, treat patients or perform other jobs tied to specific locations. Some companies have responded with programs ranging from van-pooling to bike-sharing.

Another alternative is compressing the five-day work week into four, 10-hour days. Condensed work weeks are the most popular program for employers trying to reduce workers' commuting costs, according to a recent survey by Challenger, Gray & Christmas, a job placement consulting group.

(The Associated Press)

Delta prez: 'Merger still a "go" despite conditions'

The top official of Delta Airlines says despite the ever-changing climate in the airline industry, it’s still full steam ahead for the carrier’s proposed merger with NorthWest.

Delta president and chief financial officer Ed Bastian says he understands why other airlines have hesitation for jumping into merger deals given the economics of the industry today. However, nothing is changing with the Atlanta-based carrier’s plans to combine with Minneapolis-based Northwest.

Bastian made the comments Tuesday at the company’s annual shareholders meeting in New York. He did say that further domestic capacity cuts will be needed for Delta in the future to help deal with spiraling fuel costs. Additional job cuts however, are not planned.

Delta announced in April it would combine with Northwest, and base its headquarters in Atlanta--Delta’ current home. Just last week, United and US Airways broke-off discussions on a possible merger between those two carriers.

Delta says 'no' to first-bag fee

Delta Airlines will still allow passengers to check one bag without facing additional fees. That’s in spite of American Airlines’ announcement Wednesday that it will charge customers $15 for their first checked bag. Record fuel prices are forcing Delta and other airlines to consider adding fees and cutting operating costs.

Delta adjusts to rising fuel costs

Delta Air Lines today announced a partial hiring freeze among steps it’s taking to deal with soaring fuel costs.

Delta and other carriers are trying to manage the rising expense of fuel in their budgets. From a mid-January average price of $1.73 a gallon for fuel, the jump has been substantial--to an average $2.55 a gallon at the end of November.

Atlanta-based Delta says it’s holding-off on new hires for positions that are not face-to-face with the public, such as in office and administrative areas. A spokesperson says there will not be job cuts.

The airline also plans to reduce the number of flights for off-peak times on particular routes. Also, it will go ahead with the return of 13 leased jets from a fleet of around 450.

In a web-cast of an investors conference earlier today, Delta president Ed Bastian said its operating profit margins for the 4th quarter of this year, will come in flat or down 2-percent. Its earlier projections called for profits of 3-5 percent.