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Highlands Today

Asphalt Bids Disappoint County Officials

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By Jim  Konkoly | Highlands Today

Published: September 7, 2007

SEBRING — Paving companies did not, as county officials had hoped, lock in lower prices on asphalt for three years to lower the cost of road resurfacing.

As a result, the county will continue giving "serious consideration" to building its own asphalt plant, according to Guy Maxcy, chairman of the Highlands County commissioners.

At Thursday's bid opening on the county road resurfacing contract, APAC -Southeast Inc., a paving firm headquartered in Winter Haven with an asphalt plant in Avon Park, submitted the low bid of $86 per ton for "virgin mix" asphalt.

That is $5 per ton lower than the county's current contract price.

APAC , though, committed to that price for only six months, through March 31, citing uncertainty of materials costs.

Only one of the three bidders, Ranger Construction Industries Inc. of Fort Pierce, bid on the three-year deal the county sought, at $140 per ton for the virgin asphalt mix.

"I would think that would be too expensive," Maxcy said.

Commissioner Barbara Stewart, who also attended the bid opening, said the new asphalt bids won't help the commissioners in deciding whether to borrow $3.3 million to build a county owned and operated asphalt plant.

"It (bids) didn't show that it would be more expensive or less expensive to use the private sector versus a county-owned asphalt plant," Stewart said.

She also said the bids "don't justify or not justify the county having its own asphalt plant."

On Aug. 14, commissioners were expected to vote on the asphalt plant but put the decision off at the request of the Asphalt Contractors Association of Florida. At the urging of industry representatives, commissioners that day agreed to delay their decision until new bids could be submitted by asphalt pavers.

Ken Wheeler, the county's solid waste director, has said a county plant could provide resurfacing with virgin mix asphalt at $67.55 per ton, a savings of $23.45 per ton over the current contract price of $91 per ton.

Based on those prices, Wheeler said in mid August, a county plant would save about $750,000 per year while the debt on the plant is being paid off, and well over $1 million per year when the debt is gone. His analysis was based on producing 31,000 tons of asphalt per year for the county, Sebring, Avon Park and Lake Placid.

"The good news is that we have options," Maxcy said after Thursday's bid opening. "We'll decide what option to take that is the best for our county, and that may mean going into the asphalt business.
"In the past," he added, "the bad news was that we didn't have options, it was a 'take-it-or-leave-it' situation."

Better Roads, based in Naples with an asphalt plant in Lake Placid, holds the current county contract and submitted the same price –– $91 per ton for virgin mix –– for the new contract. Citing uncertainty over the future costs for materials, Better Roads rejected a three-year deal and guaranteed its price for one year.

Stewart expected the companies to balk at a three-year deal.

"I'm not surprised completely, because I did not expect any bids for three years with the uncertainties and the volatility in the market on prices for materials," she said.

Cheryl Angel, representing Lane Construction Corp. a Connecticut company with an asphalt plant in Lake Placid, attended the bid opening although her company did not bid on the resurfacing contract. Instead, her company submitted a detailed written explanation of why it thought a valid price could not be offered for three years.

"It's not fair when somebody's asking us to look into a crystal ball three years down the road," Angel said. "We have no idea what's going to happen with oil or aggregate or other (material) costs, that's up to the suppliers."

Commissioners may vote on the county asphalt plant project at their Sept. 18 meeting.
"I really think the (county owned) asphalt plant needs serious consideration," Maxcy said. "I am not saying I want to do it yet. We still have to crunch the numbers and talk with staff. But I am saying it needs serious consideration."

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