Tiny uses $70K in infrastructure reserves to offset petrol spike

·2 min read

Times are tough at the pump for everyone.

Tiny council agreed to complete 2022 paving projects using an estimated $70,000 from infrastructure reserves; the choice was favoured over cancelling a project to pay for others.

Public works director Tim Leitch provided the staff report to council at a recent committee of the whole meeting.

“One thing we track annually is our asphalt cement (AC); it’s the binding agent in our hot mix asphalt,” Leitch explained.

“Obviously this is a petroleum-based product, and I think we all can witness every day when we put the nozzle in our tanks that the fuel prices have gone up extremely.”

The municipality relied upon statistics provided by the Ontario Ministry of Transportation (MTO) AC price index, which submitted the 2022 paving tender in January when the price of AC was at $917.50. Within the staff report, the average price of a tonne of AC for April 2022 was $1,156 – 35 per cent higher than April 2021 – with even higher prices expected to come from supply and demand in summer months.

Staff anticipated that when township paving occurs in June and July, the AC price would be roughly $1,250 per tonne with a calculated overage of an additional $138,000 to the tendered contractor, resulting in a budget shortfall of approximately $70,000. It was this reason staff went to council for direction.

“We’ve provided two options to council,” said Leitch. “One would be to cancel one particular project (paving Winterset Avenue at roughly $64,000) and use that revenue to offset the other capital costs that we’re going to be absorbing with the AC; and the second option would be to go from infrastructure reserves to continue on with this project.”

Coun. Cindy Hastings summed up that luck could play a factor in lower petroleum costs but it was an unlikely scenario.

“I think it’s important that we carry on with our capital projects that we have planned within reason, and have our fingers crossed for next year that it will be a bit better,” said Hastings.

Council were in favour of the infrastructure reserve usage and carried the motion.

Information on the 2022 asphalt price adjustment staff report can be viewed within the agenda page located on the Tiny Township website.

Archives of council meetings are available to view on Tiny Township’s YouTube channel.

Derek Howard, Local Journalism Initiative Reporter, MidlandToday.ca

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting