Like many University students, LSA Junior Aylin Downey uses her car to buy groceries and sometimes shares taxis with her friends on the way back from a late night out. But as gas prices rise to record highs, Downey said she may reconsider her transportation choices.

If prices get too high, Downey said she might consider taking the bus to buy groceries instead of driving. When Downey her friends share a taxi, one person usually picks up the tab and the others promise to pay their share later. Repayment, she said, is often forgotten.

But after the Ann Arbor City Council raised taxi fares last week, Downey said she might be more careful about paying for taxi rides.

The fare increase includes an extra 50-cent charge per trip, an additional 15 cents per mile and a new 25-cent surcharge. That means a three-mile trip that used to cost $8.80, now costs $10.

Sarah Singleton, secretary of the city's Taxicab Board, said the rate increase is meant to help taxi companies remain profitable despite rising gas prices.

The previous taxi rates were set in Oct. 2007, when gas cost an average of $2.93 per gallon, according to the Automobile Association of America. The average price for a gallon of gas in Ann Arbor was $4.02 on May 22.

"It will probably ease the pain the taxicab companies are feeling," Singleton said. "But it's only a temporary fix."

Singleton said the surcharge isn't a real solution. To fully tackle rising fuel costs, Singleton said the city might consider deregulating taxis in Ann Arbor, although such a measure is at least three to six months away.

For now, the price increase isn't going to make any taxi drivers rich, but it will help keep them from going broke, said David Rosenstock, a Yellow Cab taxi driver. Rosenstock said he doesn't expect the surcharges to hurt business.

"If people need cabs, they're going to use cabs," he said.

Yellow Cab, one of the local companies that pushed for the city to increase rates, did not return calls for comment.

Keith Johnson, the general manager of the University's Fleet and Garage Operations, said the University has also felt the pinch of rising gas prices.

In July 2007, the University paid $2.426 for a gallon of B20 biodiesel. The University expects to pay $3.930 per gallon this month. The University gets a tax rebate for using biodiesel from a specific supplier, so its fuel prices are cheaper than those paid by consumers.

Johnson said there isn't much the University can do to fight rising fuel costs aside from leaving the buses parked. But the University doesn't plan on reducing bus service, he said.

"Buses have become like water and electricity," Johnson said. "It's part of running the campus."

University buses return between 2 and 4 miles per gallon and travel more than one million combined miles per year, said Dave Miller, executive director of University Parking and Transportation services. During fall and winter semesters, Miller said typically 35 to 40 buses run at any given time.

For the fiscal year 2007, that cost $700,000 in fuel alone. For the fiscal year 2008, Miller said the University projects a fuel bill of $900,000 - which could rise to more than $1 million if fuel costs continue to climb.

Experts predict that fuel costs will continue to rise for the foreseeable future. If so, Downey said she would find ways to avoid taking taxis or driving her car - so long as it's warm out.

"(Rising prices) would make me more likely to walk," Downey said. "Unless it was really cold."