SAN BENITO — In San Benito, the waiting is over.
For weeks, city officials have been bracing to open bids on materials for this year’s $1.5 million street paving project, concerned the supply chain crisis’ high asphalt prices might force them to cut back on paving.
In Harlingen, officials are mulling scratching a 1.6-mile Commerce Street project as they await asphalt bids expected to come in about 25 percent higher than last year.
Since 2020, the coronavirus pandemic’s economic slowdown has led to production cuts in oil-based products such as asphalt, driving up demand while spurring rising costs.
High bids
At Frontera Materials, which offered San Benito its lowest asphalt bid, prices stood at about $50 to $55 a ton before jumping after 2020, Brandon Henry, the company’s materials manager, said.
Earlier this month, city commissioners reviewed Frontera’s winning bid showing the price of hot mix, or asphalt, had climbed to $89.79 a ton, up from about $80 last year, interim Public Works Director Anibal Garcia said.
Meanwhile, the price of limestone jumped 28 percent to $48.15 a ton, he said.
Asphalt prices account for about a third of a street project’s overall cost, an area official said.
Now, commissioners are trying to determine the price increase’s impact on the street project.
Cutting into street program
On Friday, Mayor Rick Guerra said the price increase will force officials to cut down on the number of streets they pave.
“It’s going to hurt us,” he said. “It’s going to limit us. When the price goes up, you start limiting the amount of streets you have. We’re trying to move forward and get as many streets as we can.”
As part of the city’s new $15.8 million general fund budget, City Manager Manuel De La Rosa is pulling $500,000 from the city’s $11 million unassigned funds account to finance the $1.5 million paving project, one of the city’s biggest street programs.
Mulling surcharge
Meanwhile, Commissioner Pete Galvan suggested officials consider options such as boosting the city’s monthly $2 infrastructure fee.
“We’ve discussed options,” he said. “If we need to go back and re-evaluate it, that option is open.”
Galvan also suggested officials consider a street maintenance fee such as the surcharge Harlingen commissioners passed on 2017.
In Harlingen, the monthly $4.50 surcharge raises about $1.4 million a year.
“This would maintain the (annual street) program without hindering other areas of improvement,” Galvan said.
In 2017, San Benito commissioners mulled a monthly $2 street maintenance fee projected to generate about $192,000 a year.
Despite the jump in asphalt prices, the city is planning to pave all streets on the list, Galvan said.
“It’s not going to affect the completion of the streets currently on the list,” he said. “They’ll be completed as they come. The price increase is not going to slow down the progression of the project. It’s just going to change our prices. It might be a little more expensive to get them done.”
Commerce project in limbo
In Harlingen, officials are bracing as they wait to open asphalt bids Nov. 22, when they will determine whether to scratch the Commerce Street project, running about 1.6 miles from Fair Park Boulevard to Tyler Avenue, off the annual list, Assistant City Manager Craig Cook said.
Asphalt prices account for about a third of a street project’s overall cost, he said.
At City Hall, officials factored in a 25-percent increase in asphalt prices as they prepared their bid requests, he said.
“We accounted for that in our estimate,” Cook said. “We pulled out Commerce Street. If we can afford to include Commerce, then we’ll just award it with all the rest of the streets.”
