State investigators scolded the Arizona Department of Transportation in a report that showed the agency depends too heavily on private consultants, potentially costing taxpayers more than it should.
The Office of the Auditor General also took the department to task for not providing enough oversight of these contracts to make sure companies live up to their end of the agreements.
Finally, auditors called on ADOT to improve its highway inspections, which are used make sure construction standards are being met.
During the past decade, ADOT’s reliance on outside consultants has exploded by 424 percent. That means the department now has more contracts with private consulting firms than the rest of the state agencies combined.
At the beginning of the year, ADOT had 430 contracts with 121 private consulting firms worth $559 million, according to the report released this month.
That runs the risk of higher costs for construction projects — which are then passed on to taxpayers. The report also warns that increased dependence on private companies could drain the department of its most experienced employees.
For example, the amount of experience of ADOT engineers has declined sharply over the past six years, the report stated. Since the beginning of the decade, the average experience level has dropped from five years to two years.
“This certainly raises some red flags for me, and (ADOT is) going to have to do some explaining,” said Sen. Thayer Verschoor, R-Gilbert, who chairs the Senate Transportation Committee.
He said some of the money ADOT has spent on private consultants could be invested to keep and hire employees at the department.
Also, Verschoor was concerned that auditors raised questions about the level of oversight of these multimillion-dollar contracts.
According to the report, ADOT officials have fallen far behind on contract reviews, which are required by the state. In particular, the report points out the department has allowed hundreds of these mandated audits to pile up. Some date back as far as five years and involve projects ranging from $15.7 million to $221 million.
State investigators also blasted the department for not following highway inspection procedures that were set up to ensure construction standards were being followed.
Among other things, the report states that inspectors failed to consistently record their observations and note whether the work met specifications.
Victor Mendez, director of ADOT, described the auditor general’s report as “fair” and said his department has already started to make changes.
He said a lot of the problems can be attributed to employees leaving to take engineering jobs with city and county governments — which pay more.
Mendez said he’s hired a chief auditor for the department to catch up on the backlog of contract reviews. So far, Mendez said, nearly all the auditing jobs have been filled.
ADOT officials said a recent spike in highway construction and the complexity of building roads are reasons for hiring so many consultants, and why it needs to improve inspections.
“Consultants are tools we need to use to get the job done,” Mendez said.