The Board of Mayor and Aldermen approved the purchase of 1,500 tons of road salt during its regular meeting Tuesday night. The cost was $246,885 or $164.59 a ton. Last year the city bought salt at just under $60 a ton.
The reason why Kingsport had to pay such a premium is because of a nationwide shortage of road salt, said Public Works Director Ryan McReynolds.
Kingsport, along with several cities in Northeast Tennessee, enters into a collaborative bid, with Knoxville being the lead.
“A typical year, you throw it in the bidding structure and receive your bids and get the benefit of the larger purchasing power, and everything works fantastic,” said McReynolds.
Knoxville went out to bid on the road salt in August and found no companies willing to bid on the quantities requested, said McReynolds.
“At that point we began researching what had occurred and found that last year in the Northeast and Midwest ... they had harsh winters early and repetitive snows day after day,” said McReynolds. “The communities came into a crisis situation of not having enough salt to take care of their communities. Their reaction was last spring and early summer securing percentages higher — 40 to 50 percent — more than what was secured last year.”
When Kingsport found out about Knoxville receiving no bids for road salt, city staff went out and searched for vendors. They found two — Schoenberg Salt for $171 a ton plus a $400 to $500 delivery surcharge per load and International Salt for $164 a ton with a minimum order of 1,500 tons.
Therefore, the city went with the $164-a-ton price, or $246,885. To pay for the salt, $94,000 will come from the city’s fund balance and the rest from the Streets and Sanitation Department’s budget, putting off some purchases of equipment to next year.
McReynolds said the companies told the city salt would be available in February if the winter was mild. Otherwise, the companies probably could not keep up with the demand.
“Even with mild winters you can get in situations where you need to put road salt down. That’s the gamble you take. If we keep 1,300 tons, you’re banking on having a very mild winter. That’s not something we can say with certainty,” McReynolds said, adding it is better to have too much road salt than not enough.
Kingsport will likely not have to bear the entire financial burden of paying for the premium road salt. City Manager John Campbell said the city would ask smaller, neighboring communities (Church Hill, Mount Carmel) if they need road salt and sell it at the $164 rate. In addition, Kingsport will be reimbursed by the state for the salt it uses on state routes, which amounts to one-quarter to one-third of the roads Kingsport applies salt to.
Kingsport has 1,300 tons of road salt on hand, with the storage facility capable of storing 1,500 tons. McReynolds said some vehicles would have to be moved from a sheltered structure in order to make room for the excess 1,300 tons of road salt.
McReynolds said next winter, the road salt companies should be in full production and provide for the normal ordering of salt.
Mike Arsenault, assistant director of public works for Johnson City, said the city is in good shape this year with road salt.
Johnson City normally uses 600 to 2,500 tons of road salt each year. This year the city has 3,700 tons on hand (with a maximum capacity of 5,000 tons). Arsenault said the city seeks to have 4,000 tons on hand each year.
“We’re in better shape than a lot of people. What we’ve managed to do is each year for the last three or four years is buy our standard amount, and we’ve used less,” Arsenault said. “We’re buying 1,500 tons a year and only use 500 or 600 hundred, so we’ve built up a surplus.”