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Fuel costs interrupt road construction in Indiana

The high cost of fuel isn’t just causing problems for over-the-road truckers anymore – it’s starting to affect the road itself.

In Indiana, work on two sections of road has been halted or reduced by the contractor, who says the cost of diesel is cutting too deep for the company to make a profit.

Bob Johnson, general superintendent for Smith and Johnson Construction Co. of Columbus, OH, said his company called off work on two projects – O’Bannon Highway and U.S. 231 – due to a significant increase in fuel costs since they received the project contract in 2003.

Johnson said his company called it quits in hopes of catching the attention of the state, and possibly getting a pay increase.

“That’s too much of a jump. We can’t absorb that,” Johnson said. “At three to four yards of dirt per gallon, that’s costing us 60 cents or so to move dirt a yard, and that’s way beyond our profit range.”

Standard procedure, Johnson said, is for other partners in the project to help take on some of the fuel cost.

“There is sort of a standard they’ve used in other states,” he said. “The contractor absorbs the first 20 percent. Then after that, the governing agency or the contracting agency usually helps out with the fuel cost.”

Unfortunately, the state has ordered Johnson’s company to return to work without a pay increase. Indiana Department of Transportation officials said the company is bound to complete the job at the price it bid, The Associated Press reported.

“They have basically ordered us back to work,” Johnson said. “On the (U.S. 231) job, we did go back to work with two-thirds of our equipment, and we’re going to do some work on the O’Bannon Expressway, and we’re going to evaluate it day by day.”

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