BOISE - A long-awaited performance audit of Idaho’s transportation department suggests the state could save millions through better management - but could save hundreds of millions by better maintaining the roads and bridges it already has.
“The current situation facing Idaho’s highway system is untenable,” declared auditor Bob Thomas, a consultant from Olympia. “The state is falling further and further behind in its ability to maintain and preserve its highway and bridge infrastructure. … Idaho is getting further and further into a hole.”
Senate Transportation Chairman John McGee, R-Caldwell, said, “It reiterates what the governor’s been saying for the last two years - our roads are falling apart. … You pay a little bit now, or you pay a heck of a lot later.”
Gov. Butch Otter welcomed the results of the audit, which the Legislature commissioned last year and agreed to pay for to the tune of $550,000. It came in under budget, at $450,000; it’s the work of a group of out-of-state consultants who extensively analyzed Idaho’s department and its operations, and compared it to transportation departments in nine other states.
“Simply put, we are trying to accomplish 2009 goals with 1996 dollars,” Otter wrote in his formal response to the audit, adding that he’s directing ITD Director Pamela Lowe to review the audit findings and develop “action plans” to address them.
Otter has proposed a combination of small gas tax increases, car and truck registration fee hikes, a rental car tax and other measures that over the next five years would ramp up to an additional $174.5 million a year in funding for roads. But the audit looked at his original proposal last year for $240 million in taxes and fees, and concluded even that wouldn’t be enough.
Because 38 percent of that increase would go to local highway jurisdictions and 5 percent to the Idaho State Police, under Idaho’s existing distribution formula for highway funds, the $240 million plan would bring ITD just $137 million, the audit found. “Even with the requested $137 million revenue increase, preservation and rehabilitation of existing infrastructure will fall $55 million short through 2013,” the audit predicted.
Auditors recommended a $6 million investment into a new maintenance management system, a computer software system that Idaho currently lacks. They also predicted $11 million in savings over the next five years from various management improvements; said Idaho could save up to $19.6 million on its bond issues by following different short-term interest rate strategies, though ITD disputed that; and predicted that if all its recommendations are followed, Idaho would save $6.6 million a year more after the first five years.
One of the sharpest criticisms in the new audit is that the department lacks a maintenance management system, a computer software system to track when, why and how certain sections of roadway are maintained. There hasn’t been one since 2005, when the previous system became obsolete with the installation of a new financial management system.
But the Idaho Transportation Board was well aware of that - in fact, the board made a conscious decision in 2006 to not replace the system because of the high cost of doing so, and instead put that money into road repairs. The idea was to identify new funding sources for important needs like the new maintenance management system.
“We recognize the need for a maintenance management system - we have a pilot project going on in one of our districts,” said ITD spokesman Jeff Stratten. But that pilot project is nowhere near as extensive as what’s proposed by the audit.
ITD Board Chairman Darrell Manning told lawmakers that he opposed the move to drop the maintenance management system and backs the call for a new one.
House Transportation Chairwoman JoAn Wood, R-Rigby, said she wonders if the funding for the $6 million system could come in increments, rather than all at once. But she’s thrilled with the audit overall.
“I thought it was very well done - it was exactly what we wanted,” she said. “We were so concerned last year that we were not able to get the information we felt like we needed,” to propose transportation tax or fee increases. “We couldn’t justify to our public any increase where it was not clearly beneficial to the whole state.”
Wood added, “What I really liked about this audit is the recommendations that came out of it - we should have the best department of transportation in the country if they follow all the recommendations that were made.”
Those recommendations include switching from the current “worst-first” strategy for managing deteriorating roads, to a “preservation-first” approach that fixes roads sooner and tracks conditions with the new management system. They also include more statewide coordination of what the audit termed an excessively decentralized department; prioritizing maintenance, restoration and preservation of existing roads and bridges ahead of building new ones; and rigorous and independent cost-effectiveness evaluations for new road construction projects. Also recommended were more comprehensive statewide transportation planning; a uniform selection process for capital projects; and measures to reduce turnover of key technical workers at the department.
Manning said the auditors “did a superb job, I think, identifying many of the problems.” The audit, he said, “largely validates the direction the department has been headed for the past two years. … Believe me, we will be looking at it very strongly. Even though we’re in a crisis management situation at the moment with regard to funding, we’re still going to do everything we can … to improve the system.”