North Carolina's DOT has found itself behind the bulls eye once again after a new state auditor's report reveals that the department has incurred additional costs on behalf of NC taxpayers to the tune of an extra $152 million over the last three years on 390 completed projects. The extra costs are related to mismanagement, poor planning and because of schedule changes, environmental reviews and design changes. The report states that 73 percent of those projects missed their projected construction starts. Forty percent of the projects missed that mark by more than a full year.According to Les Merritt, NC's State Auditor, "DOT is a multi-billion dollar state agency that appears to operate on hunches and intuition rather than hard data analysis. As a result, taxpayers paid $152.4 million in unnecessary construction costs."
Merritt's report indicated that the auditors found that DOT does not track or analyze delays or successes in its road-building projects, despite repeated warnings and recommendations during the past 10 years from auditors and consultants. The auditors also said that if the department had an effective system for tracking performance, officials might have seen that delays cost taxpayers over $150 million.
"The lack of performance management practices has been pointed out to DOT before," the auditors wrote.
As expected, DOT officials are disputing the findings rather than admitting they happened and are not focusing on working toward solutions. Debbie Barbour, director of preconstruction for the department, claims engineers have only a rough guess of how long a project will take when funding is approved and says the detailed engineering has not been done up front (as it should be). She states that since the engineering work has been done at approval time, the estimated completion date can't take into account problems along the way. She also argues that environmental problems, obtaining permits and other issues are out of control of the department and says it is unfair to say projects are late because of those and other issues.Signs continue to surface that the DOT is a poorly managed organization and unacceptable practices from the top down cause virtually everything DOT touches to be poorly done, to introduce avoidable significant problems and delays into projects and to cause taxpayers to pay more for substandard work that does not meet growing needs of the state.
It's time for Governor Easley, who takes much of his direction from his staff of buddies that help him make unwise choices and appointments of "good old boys" to state leadership positions, to realize the severity of problems in DOT and other state organizations and fire top leaders like Lyndo Tippett and mid-level management people like Debbie Barbour and at least make a feeble effort to re-establish a little control and get something for the billions of dollars spent on roads and projects while he is still in office.
Read the full article about findings in the study...
News and Observer
February 7, 2008
Dan Kane and Benjamine Niolet, Staff Writers
Delayed road projects cost millions
An audit of three years of completed state Transportation Department projects found many of them finished behind schedule, leading to what auditors say is an additional $150 million in inflation-related construction costs."DOT is a multi-billion 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 today looked at 390 highway projects completed between April 2004 and March 2007. Auditors said that 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 that the permitting process, environmental reviews and design changes caused many of the delays.
Department officials say the auditors held the department to an unfair standard. The $150 million figure is oversimplified and doesn't account for some $80 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 over 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 from auditors and consultants. The auditors said that if the department had an effective system for tracking performance, officials might have seen that delays cost taxpayers $150 million.
"The lack of performance management practices has been pointed out to DOT before," the auditors wrote.
But department officials say the department has 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 road building is a complex and expensive business. Rosser said 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." Original source ...
