Bus owner let out of contract

The Yukon government has decided to release Takhini Transport from its Whitehorse school bus contract a year early.

The Yukon government has decided to release Takhini Transport from its Whitehorse school bus contract a year early.

The decision was taken after the company made the request, complaining that soaring gasoline prices have made the operation unprofitable.

“The current contract doesn’t have a fuel escalation clause and, as a result, we’ve been absorbing the cost,” Pat Jamieson, who co-owns the company with her husband, Ernie, said this morning.

“After the first three years, there is a clause for CPI increase (Consumer Price Index) and that is on the overall contract and it comes to about two per cent but it doesn’t come near to meeting the fuel price.”

Jamieson estimates that since taking on the five-year contract four years ago, Takhini has spent upward of $300,000 more on fuel than originally budgeted for to keep its 40 buses on the road in the capital.

Originally, Takhini bid and won the Whitehorse contract for $1.97 million per year and, after two CPI increases, that deal is now worth $2.1 million.

Despite this, Jamieson told the Star that the dramatic spike in fuel prices in recent weeks has left Takhini with few options.

“We’ve never walked away from a contract before but in this case, I think we’ll have to,” she said.

George Gartner, director of finance with the Department of Education, confirmed the YTG’s decision.

“After due consideration, the government has decided they would let (Takhini) out of the contract early,” Garner said this afternoon.

Mayo-Tatchun MLA Eric Fairclough believes the decision to let Takhini Transport off the hook and re-tender the contract could open the floodgates for similar requests.

“Why would (Takhini) be allowed to opt out of their contract?” Fairclough asked in an interview.

“Is the YTG going to be treating other companies in the same manner, like Alkan Air?”

According to Gartner, the contract has been re-tendered and will close May 21.