State audit critical of lagging DOT projects

Added costs put at $152 million

An audit of three years of state Department of Transportation projects found that many of them finished behind schedule, leading to what auditors say is an additional $152 million in inflation-related construction costs.

"DOT is a multibillion-dollar state agency that appears to operate on hunches and intuition rather than hard data analysis," State Auditor Les Merritt said. "As a result, taxpayers paid $152.4 million in unnecessary construction costs."

The 43-page audit released Thursday looked at 390 highway projects completed between April 2004 and March 2007. Auditors said 73 percent of those projects missed their projected construction starts. Forty percent of the projects missed that mark by more than a full year, Merritt said.

The audit said the permitting process, environmental reviews and design changes caused many of the delays.

Department officials said the auditors held the department to an unfair standard. The $152 million figure is oversimplified, they said, and doesn't account for some $86 million the department saved by expediting projects within the same time frame.

The auditors based a project's start date and projected completion date on when the transportation board approved money for preliminary engineering. The problem with that method, said Debbie Barbour, director of preconstruction for the department, is that engineers have at that time only a rough guess of how long a project will take. Since no engineering work has been done, the estimated completion date can't take into account problems along the way.

"In developing a project, there are certain things that are outside the department's control, such as obtaining an environmental permit," Barbour said. "We don't really have control of the time frame on every activity in the approval process."

The auditors found that the department does not track or analyze delays or successes in its road-building projects, despite repeated warnings and recommendations during the past 10 years. The auditors said that if the department had an effective system for tracking performance, officials might have seen that delays cost taxpayers $152 million.

"The lack of performance management practices has been pointed out to DOT before," the auditors wrote.

But department officials say they have implemented several new programs and processes since 2001 that wouldn't have been evident in the time period the auditors examined. The department has worked with the state Department of Environment and Natural Resources to streamline environmental permitting. The department measures whether it met target dates for acquiring property for a project or opening bids.

And the department has spent $3.6 million to hire a consultant to help officials change the way the department does business.

Bill Rosser, the state highway administrator, said that the department works hard to finish projects on time but that road building is a complex and expensive business. Rosser said that if the auditors looked at a newer set of projects, the findings would be much different.

"We would like to be responsive and deliver our projects," Rosser said. "We're always looking at the way the process works."