Businesses hike costs to cover gas prices
Fuel-related charges added to customers’ bills
CAPITAL REGION You know spring is getting off to a crappy start when even the rental fee for portable toilets is increasing.
Crocuses and shorts are not the only things popping up this spring. As Capital Region businesses brace for record high gasoline and diesel prices, hefty fuel-related charges are appearing on bills for everything from pool repair and lawn mowing services to soil deliveries and cruises along the Hudson River.
At A-1 Johnny on the Spot in Waterford, owner David Taylor Sr. is charging 4.5 percent more for the portable restroom units he rents. For A-1 customers, each unit will cost an average $104.50, compared to $100 a year ago.
A-1 has traditionally supplied portable restrooms for the Schenectady Air Show in Glenville and the Skidmore College Saratoga Classic Horse Show in Saratoga Springs.
“There will be grumbling, but they don’t have much choice,” said Taylor.
The $4.50 hike should help A-1 cover the rising costs of diesel fuel and general liability insurance. Diesel on Thursday was selling in the region for an average $4.25 per gallon, up 51.2 percent from a year ago, according to the AAA Fuel Gauge Report.
A-1, a 55-year-old Waterford company with four delivery trucks, is lumping the fuel charge into the total rental cost. A-1 did not raise prices last year, but it had implemented a 3.5 percent hike in 2006.
When the Captain J.P. II leaves its Troy dock and starts hosting cruises in May, passengers will have to pay 15 percent more to ride the ship along the Hudson River. That approximately $5-per-passenger hike is intended to cover not only more expensive fuel but also the costlier food and beverages served aboard the 600-seat vessel, said James Pledger, president of the Captain J.P. Cruise Line.
“The fuel charge is not the biggest factor. It’s across the board,” said Pledger.
Pledger did not increase ticket prices for the Captain J.P. last year, but in 2006 he adjusted prices by 4 percent. He is anticipating a 10 percent decline in passenger traffic this year as many of his corporate customers look to trim costs by not holding traditional business meetings or employee outings aboard the vessel.
Crude oil’s march above and beyond the psychological barrier of $100 per barrel is forcing many Americans and businesses to curb their driving habits. And the prospect of any short-term relief at the pump is looking increasingly far-fetched.
Although the price of crude tumbled last week close to the $100-per-barrel mark, it shot up this week, closing Thursday at $107.58. OPEC, which controls 70 percent of the world’s known oil reserves, has repeatedly brushed off Bush administration requests to increase oil production. The cartel has even discussed cutting production amid softening U.S. demand.
Given oil’s supply outlook, the U.S. Energy Information Administration is projecting regular gasoline prices to peak this spring between $3.50 and $4 per gallon. Fearing those high prices, Gina Cuomo at Cuomo Country Pools in Duanesburg will limit repair and service work to a 30-mile radius.
Along with cutting Troy from her pool service area, Cuomo is also considering increasing prices to cover higher fuel costs.
“We’re trying to find ways to cut the cost so it doesn’t get passed on [to customers],” said Cuomo, a co-owner of the pool sales, service and installation company.
Cuomo said she might waive the fuel charge if customers allow her to select the day when crews come to work on pools. That arrangement would allow Cuomo to schedule multiple jobs within a general area and minimize driving.
The higher cost of gas is also making Cuomo rethink her policy of offering free estimates on pool work. She may impose a fee to cover driver expenses, but that cost might be waived if a prospective customer contracts with Cuomo.
At Wells Nursery in Niskayuna, President Jonathan Wells is increasing his delivery charge to about $3.50 per mile, up about 15 percent from a year ago. But he charges a flat rate for deliveries within five miles.
“Other than having to do a lot of explaining to previous customers, I don’t know what to expect,” said Wells.
Red Oak Landscaping in Guilderland introduced fuel surcharges to customers about four years ago. The landscaper this spring set its base fuel surcharge level at $3 per gallon, up from $2 last year.
For mowing and other work, Red Oak will charge an additional 2 percent of the job’s total cost on days when gas costs at least $3.25 per gallon. At $3.50 per gallon, the fuel surcharge becomes 4 percent, said Red Oak Office Manager Richard Leininger.
“We find that 99 percent of people are very understanding. They don’t like it, but what can they do?” Leininger said.