KNOXVILLE, Tenn. (Story Courtesy of WVLT) – Diesel prices in the Knoxville area have climbed to an average of $4.47 per gallon, according to AAA data — up more than $1.10 from just one month ago and up from $3.34 a year ago. The increase is putting pressure on school transportation budgets in Anderson and Knox counties.
Anderson County Schools contracts five companies to operate 46 buses, transporting about 1,500 of the district’s approximately 6,000 students each day. District leaders said the current price spike is already adding roughly $12,000 to this month’s transportation costs alone.
Ryan Sutton, communications and PR coordinator for Anderson County Schools, said the full-year impact could be significant.
“If diesel remains the same, it’ll be about $50,000 additional to our transportation budget than was originally budgeted this year,” Sutton said. “However, with trends increasing and overseas tensions rising, we wouldn’t be surprised that if it went all the way up to an additional $100,000 needed to bring our students to school every day.”
“We’ve got to tighten the belt a little bit as far as what we’re doing,” Sutton said. “So we’re looking at maybe those extra things at the end of the year that we may want to purchase — holding off on those so that we may be able to take those funds and set those aside for the additional diesel fuel.”
District leaders said getting students to school is non-negotiable and that bus routes will not change as a result of the price increases.
Joe Doninger, director of business development for KTG Bus, said fuel costs account for about 20% of the company’s operating expenses in Tennessee, compared to 11% at its locations in other states.
Doninger said Knox County does provide a fuel subsidy, but it does not cover the full increase.
“Every time the fuel goes up, Knox County gives us a subsidy, but it doesn’t cover the whole thing,” Doninger said.
“So we end up making less money and using the money that we would use to improve buses, increase driver pay — it has to go into fuel,” Doninger said.
Doninger said KTG Bus’s insurance costs have also doubled in the past year, adding to the financial pressure. He said smaller contractors with one or two buses face the greatest strain, as large insurance carriers are less willing to cover small fleets.
Doninger noted that during spring break, contractors are not paid because buses are not running. KTG Bus uses that time for deferred maintenance and driver training.
AAA data shows the all-time recorded high for Knoxville-area diesel was $5.655 per gallon on June 10, 2022.
