A gravel truck contractor told County of Wetaskiwin council July 17 that the municipality’s rates for such work are too low and truckers can barely break even.
Dale Franklin appeared before council at their Public Works meeting July 17 to voice concern about what the county pays private contractors who haul gravel.
Franklin, who also sent a letter to council, noted the county has had the same rate for hauling for the past 30 years, while expenses for truck drivers have increased steadily over time.
He also noted that, a few years ago, rates were even cut. Franklin said he’s not alone in the concern; others in the local Wetaskiwin trucking community are also concerned.
He noted that he became more familiar with the issue last year when he spent an entire season hauling gravel for the county and found it difficult to make a profit. “You’re not covering expenses,” said Franklin to council.
Director of Public Works Neil Powell provided councilors with information on hauling rates in their agenda package. He stated, “For all services rendered by the Contractor to the County, the County agrees to pay the Contractor as follows: $0.90 (Ninety Cents) per tonne loading fact, $0.24 (Twenty-four Cents) per tonne per loaded mile hauling fact.”
Powell continued, “The issue of increasing haul rates can be addressed by Administration prior to next year’s contract. Due to rising fuel prices, and considering that the last review was 5 years ago, it may be prudent to revisit the rates. Keeping rates lower may initially cost less for the County, but eventually, the better Owner Operator’s (haulers) will drop away and the County may be left with few options for custom hauling…”
Franklin stated in his original letter, “I feel the rates are too low as the rate barely pays for fuel and wages. With the rate being that low a person cannot figure in the cost of repairs, payment on equipment or any profit margin. I understand that the County of Wetaskiwin is not supposed to run like a business. The County of Wetaskiwin can run at bare cost and still make budget. The County should not be making a profit as they are Municipally and Provincially funded. In the private sector that does not work because we cannot change our budget to match what we need to pay for expenditures.
“The current gravel haul rate is .90 cents per tonne loading factor and .24 cents per tonne per loaded mile hauling factor. In 1987 the gravel haul rate was 70 cents per yard loading factor and .20 cents per yard per loaded mile hauling factor. A yard is approximately 1.18 tonne. Fuel prices in 1987 were 42 cents per litre. Now the fuel price is over $1. A new gravel truck was roughly $65,000, now the cost is $110,000.00 minimum. Wages have also gone from $10 per hour to $30 per hour. So, you can see in the last 31 years the gravel haul rate has not kept up with the cost of expenses. When you compare 1987 rates to current rates, the increase works out to 7.4 cents per tonne loading factor and .4 cents per tonne per loaded mile hauling factor. As you can see that is not a huge difference in 31 years.”
Councilor Terry van de Kraats agreed the rates need to be reviewed, and said he feels hauling rates should be fair to all, not just the municipality. Councilors agreed to place hauling rates for discussion on the strategic planning agenda.