Budget & Finance

Some Surprising Things Schools Might Have to Cut Because of Fuel Cost Increases

By Mark Lieberman — April 13, 2022 | Corrected: April 14, 2022 4 min read
Composite of photo of gas prices and bar chart showing an upward arrow with an illustration of a gas pump.
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Corrected: An earlier version of this story misidentified the state where the Anoka-Hennepin school district is located.

Rising fuel prices show no signs of dropping back to pre-2021 levels anytime soon, leaving school districts to worry about a wide range of impacts to their budgets and operations.

More than nine in 10 district leaders who answered an EdWeek Research Center survey between March 30 and April 8 said fuel prices in their district have risen since the start of the school year. Fourteen percent of district leaders said fuel costs have doubled or more than doubled since then, and 56 percent said they’ve increased between 1 percent and 50 percent.

Bus drivers who contract with districts are already feeling the pinch. Some are asking districts for an unusual mid-year raise to cover fuel and maintenance costs. Others are contemplating shutting down their companies altogether.

For school districts, when an actual cost exceeds what was budgeted at the start of the year, another line item in the budget often has to shrink or disappear altogether. That could mean the loss of staff members, academic programs, or transportation services.

Fuel will cost the 37,000-student Anoka-Hennepin district in Minnesota $100,000 more than expected this year, said Superintendent David Law. The district’s $550 million annual operating budget can absorb that increase. But if the high costs persist through the summer into next school year and beyond, it may be a different story, he said.

The district is in the middle of a five-year contract with its bus providers that includes some adjustments for fuel increases. But the current spikes are likely to exceed what’s in the contract.

“Our state increase [for the overall operating budget] this year is 2.5 percent,” Law said. “When part of our budget sees a 15 percent or 18 percent jump, that pushes a cut somewhere else.”

That kind of squeeze makes it difficult to help educators who ask the district for more classroom support. Law recently shared with employees at one of the district’s elementary schools a presentation on the ins and outs of school funding. Teachers said one of the things that would make their jobs easier would be to have a paraeducator in all 42 classrooms.

“Okay, that’s $600,000. We don’t have that additional budget, and you’re our smallest of 26 elementary schools,” Law told Education Week. “To take that to scale, what I said is, we could do that and no employee group would get a raise.”

Cost of food deliveries increases amid fuel price surge

It’s not just student transportation that is feeling the effects of increased fuel costs.

Eleven schools in Davenport, Iowa, each week receive two deliveries of fresh fruit and vegetables through a U.S. Department of Agriculture grant program. More than 4,500 students take advantage of these offerings.

For the last month, each delivery has come with an $8 fuel surcharge, said Coni Dobbels, supervisor of food and nutrition services for the district.

The program has a fixed $256,000 grant for the entire school year, and each school building gets allocated a portion of those funds based on the number of students.

Thanks to the fuel surcharge, one district has already run out of funds to continue getting its weekly fruit and vegetable deliveries, and other schools are headed for the same fate, Dobbels said.

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Meanwhile, the district’s bread vendor recently told Dobbels it won’t be able to continue delivering to her district unless she can pay 20 percent more to cover fuel cost increases.

“We spend about $60,000 on bread,” she said. “That’s almost $12,000 that we’d have to pay.”

Instead, she’ll have to find another vendor for next year, or purchase frozen bread from a different vendor the district already uses.

Dobbels said she could ask the school board for additional funding to cover the increased costs, but she thinks the district will prefer allocating more resources to the classroom. Instead, she anticipates having to increase the cost of students’ meals next year. With the loss of federal funding for universal free school meals, that means more students may end up incurring school meal debt if they can’t pay for food.

Meanwhile, the fruit and vegetable program that introduces kids to new healthy foods between breakfast and lunch may shrink if the federal government doesn’t increase funding. That worries Dobbels, who grew up on a farm with tight margins and ate free meals at school as a child.

“Even though they’ve had breakfast at 7:30, they might not be eating their lunch meal until 11:30 or 12,” Dobbels said. “The kids need it. Their growing bodies need a little pick-me-up.”

Settling in for the long haul

Some districts are getting creative to navigate the increased cost of operating school buses.

In Lansing, Mich., the district has provided half a million dollars in gas cards to families who opt out of sending students to school on the bus. The Richland County schools in South Carolina offered $500 bonuses to staff to help them cover the higher cost of getting to and from work.

Districts will need to adjust to these fuel prices for a while. Experts say shortages in the supply of diesel will keep fuel prices high for the foreseeable future. Energy costs like heat and electricity could face similar increases as well.

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