Rising gas prices starting to affect Volusia County and area cities’ gas budgets

DAYTONA BEACH — With still months to go in the fiscal year, the county and some area cities anticipate exceeding their fuel budgets by year's end.

The dramatic rise in gas prices has caused Volusia County's gas budget to trend 20% over budget, according to officials. Area cities are also reporting fuel cost increases of up to 30%.

While residents feel the effects with each rising cent, the now months-long crisis is beginning to worry local officials, with some already making moves to adjust gas budgets.

According to AAA Auto Club, on Monday the average regular gas price in Florida was approximately $4.66 a gallon, with the national average at $4.89 a gallon.

Robert Gilmore, Volusia County’s fleet director, was last in front of the County Council on Feb. 15 giving a status update on his division’s budget. During his presentation, he mentioned fuel price volatility and uncertainty as one of the division’s top challenges and added that the nation could expect a price spike if, in his words, “this Russia thing blows up.” The war in Ukraine started five days later.

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“Currently, our fuel costs are trending at about 20% over budget,” Gilmore wrote in an email to The News-Journal on June 14. “Conservation efforts are helping, as evidenced by the fact that we’re trending about 5% under in gallons used. While that’s helping to keep fuel costs a little closer to the budget, prices are showing continual signs of increase.”

Gilmore said that the county will eventually have to “find money in our budget to cover the increased fuel expenses.”

“Fleet management is anticipating the need to transfer funds by the end of the year to cover the increased fuel costs,” he said.

The need for budget adjustments, however, is not the only thing that can help with these costs. Gilmore said that the county is taking steps to save money on fuel.

“A fuel conservation notice was sent to all divisions which included information to help employees conserve fuel to the maximum extent possible while doing their job,” he said.

Some of these steps include:

•  Combining or eliminating trips to reduce the miles driven.
•  Driving conservatively by avoiding aggressive acceleration.
•  Driving slower.
•  Eliminating any unnecessary idling.
•  For vehicles that display fuel economy information, drivers are asked to increase their vehicle’s average fuel economy.

“The message seems to be having a positive impact, as our fuel usage has gone down over the past couple of months,” Gilmore added.

Area cities beginning to feel the effects

In Daytona Beach, the City Commission is already taking action to adjust the city’s budget.

At its June 15 meeting, city commissioners approved a budget amendment to increase the gas/fuel budget for various city departments by $820,411.

In a memo sent to city commissioners for the meeting, City Manager Deric Feacher wrote that “the current budget does not adequately fund vehicular operations for the remainder of the year,” according to an estimate by Business Enterprise Management Director Michael Stallworth.

At the beginning of the fiscal year on Oct. 1, the total budget for fuel and oil across all departments was $1,320,860, according to a city spokesperson. Many departments are close to exceeding their budget allocation. 

The police department alone budgeted $726,202 for fuel costs and more than 70% of that allocation has been spent.

“We have requested that the individual departments and divisions examine their operations to determine if actions can be taken to reduce the amount of gasoline that is consumed,” Feacher wrote. “Any such changes in operations would result in budgetary savings.”

He added that the current prices may represent a temporary spike, which could lead to budgetary savings later on in the year, but not if prices continue to rise.

“If prices continue to climb, it is possible that additional funding will be requested later in the year to fund any future shortfall,” Feacher wrote.

The approved budget amendment to increase gasoline and fuel budgets will transfer money from the city's General Funds to the Capital Projects Fund. 

While Daytona Beach has already started to make adjustments, other Volusia cities expect to follow suit later this year.

In New Smyrna Beach, of the $379,669 budgeted for gas in 2022, $247,534, just over 65%, has been spent to date, according to city spokesman Phil Veski. The city is expecting a $51,112 gas budget gap based the estimated need through the remainder of the year.

“The nature of city government work – for example, rapidly responding to emergency police, fire and maintenance calls – does not easily lend itself to consumer-level tactics such as bundling trips or hypermiling,” Veski wrote in an email. “However, recent modernization efforts have seen our vehicle fleet gradually transition from 8-cylinder engines to more economical 6- and 4-cylinder variants, including hybrids.” 

He added that “city commissioners will be presented with a budget amendment on a future meeting agenda before the end of the year.”

In Ormond Beach, fuel costs are up 30% in the fiscal year to date, and the city’s finance department expects they will be “double the budgeted amount by year end.” 

“No changes are proposed for the current year’s budget; however, we anticipate an additional $500,000 added to next year’s budget,” the city’s finance director, Kelly McGuire, wrote in an email.

In Port Orange, there have been no budget changes so far either, according to city spokeswoman Christine Martindale.

The city is evaluating ways to save money, including sharing vehicles, not idling the vehicles’ engines and gas mileage maintenance (keeping tires properly inflated, etc.), which will be discussed at future budget workshops.