Governance is the Transportation Department’s most pressing issue this year, even more pressing than the funding issue, the agency’s Secretary Christy Hall told a House transportation panel on Thursday.
“There’s a lot of uncertainty as to where the buck actually stops in the organization,” said Hall, citing high turnover in some counties.
She gave her comments at a hearing after the Legislative Audit Council released a more than 300-page report on the agency Tuesday. The agency agreed with more than 120 of the council’s approximately 140 findings.
The audit found weak spots in the agency’s governance structure, funding stream, ranking process and internal auditing.
The agency’s current structure undermines the authority of both the SCDOT Commission and the agency head, according to the report.
Currently the governor appoints the agency secretary, and legislators appoint the commission, a practice Hall said makes the commission beholden to the Legislature.
But Hall said she believes the commission is needed because of its role in oversight.
Transportation Department commission chairman, Mike Wooten said it’s Christy Hall who’s running the agency. “I think that’s the way it should be.”
Wooten agreed the governance issue needed to be addressed and that the commission should focus on oversight, not running the daily operations of the agency.
Hall’s comments about the pressing nature of addressing governance assume the House budget is approved by the Senate and the Governor. The budget includes $415 million for road maintenance and construction.
The funding would buy the agency a year, which it can use to roughly apply the funds to a set of funding scenarios it developed in case of additional recurring funds.
Under the plan, the SCDOT could use $400 million to put 95 percent of the state’s Interstates and 35 percent of the primary roads in good condition over 10 years. That scenario would also stop the decay on many of the state’s secondary roads and reduce structurally deficient bridges on Interstates and primary roads by 50 percent.
Forty-seven percent of the state’s traffic travels on primary roads. The agency has forecast 90 percent of primary roads to fall into fair or poor condition in approximately 10 years without additional funding.
Currently 80 percent of these roads are in fair or poor condition.
“If people truly understood the situation our state is in with transportation,” Wooten said after the hearing, “a whole lot more than 70 percent would be in favor of a gas tax.”
Approximately 70 percent of people in South Carolina support an increase, according to Wooten, a self-proclaimed “poster boy” for the motor fuel user fee. He blamed robo-calls by the conservative group, Americans for Prosperity, for shutting down a gas tax increase in the Senate.
Wooten admitted a tax increase would be affect poor drivers most, but said it was a fair tax.
The gas tax is currently 16.75 cents per gallon, which isn’t tied to inflation.
Audit manager, Brad Hanley told representatives gas taxes and fees needed to be tied to some economic indicator.
Hanley said policy makers should also diversify funding sources to offset income lost as a result of increasing fuel efficiency.
Prioritization and audits
The agency took exception with the council’s finding that it should condense its multiple project lists into one.
Hall and her staff rolled out a 55-foot-long list of 1,100 hypothetical projects in front of the panel to show members how impractical a single list would be.
The ever-changing nature of multiple project lists, plus restrictions on how federal and state dollars can be spent make a single list impossible, according to Hall.
But having multiple lists makes it hard to tell that the right projects are moving forward, said Hanley.
The audit identified problems with transparency in how the projects were ranked and prioritized, which SCDOT agreed to.
And the audit council also found SCDOT’s State Transportation Improvement Plan to be problematic. That plan is a six-year infrastructure plan for federally funded improvements. “The average person can’t tell what was going on,” said Hanley.
The council also found audits by the agency’s internal auditor needed to be first be approved by the commission.
Wooten said the commission never prevented an audit from going out, except in one case, which the state inspector general agreed with.
Hanley spoke after the hearing about an auditor who abandoned the risk assessment part of his job after the agency changed his job description.
The Senate plan addresses governance by allowing the governor to appoint the SCDOT Commission. It also pulls $400 million from general fund revenues to fund roads, a plan that many House members called unsustainable.
The House is mulling how to go forward with the audit council’s recommendations. Rep. Russell Ott, D-St. Matthews, fretted making the agency dependent on general fund revenue. “I actually think it could exacerbate our problems in South Carolina.”
But Rep. Mac Toole, R-West Columbia, said “throwing money at this issue and thinking that’ll solve our problems” wasn’t a good idea.
The LAC is set to complete in early May an audit of the State Infrastructure Bank, which approves and finances projects over $100 million.