State lawmakers may adopt prescriptions from a recent audit that found the state Department of Transportation underestimated the costs of large highway projects by more than $3 billion.
The Assembly Transportation Committee last week approved a bill to implement most of the audit’s recommendations for changes to state law, while the Senate is set to vote on the bill this week.
The Assembly panel made one key change to the bill: removing a provision that would permit DOT, on a limited scale, to design and build highway projects without bidding them out.
The bill would enact the audit’s suggestion that DOT be required to account for inflation and all other expected costs when providing future cost estimates for major highway projects.
The audit’s bombshell finding was that, due in part to inflation, cost estimates for 16 ongoing major highway projects now add up to nearly $5.8 billion — more than double what the department estimated when the projects became law.
The bill also requires all parts of a project — as the project was defined when lawmakers approved it — be accounted for in updates on its expected cost.
Lawmakers roundly criticized DOT for quietly splitting off a big part of the U.S. Interstate 39/90 project — a rebuild of its interchange with the Madison Beltline — into a separate project, thereby downplaying increases in its projected cost. The estimate for the 39-90 project, including the interchange rebuild, exploded from $715 million to $1.75 billion, though DOT Secretary Dave Ross has vowed to re-examine a $550 million estimate for the interchange rebuild.
The provision removed from the bill by the Assembly committee would allow DOT, for no more than three highway improvement projects, to use a construction manager-general contractor process whereby it hires a contractor to supervise the design of a project. Subject to an acceptable proposal, that contractor then may be hired to build it. Current law requires that state highway improvement projects must be bid out.
The audit, released in January by the nonpartisan Legislative Audit Bureau, found the Minnesota DOT has used the construction manager-general contractor method to realize savings on some highway projects.
Assembly Transportation Committee chairman Keith Ripp, R-Lodi, said the provision was removed “to allow for further discussion about WisDOT bidding standards this legislative session.”
“By removing this provision, it ensures legislators can work together with various stakeholders and WisDOT to evaluate the state’s bidding requirements,” Ripp said.
An identical amendment is proposed for the bill’s Senate version. It received a public hearing in March and is set for a vote Wednesday in the Senate Transportation Committee.
Ross has said DOT is adopting all audit recommendations for action by the department. Ross, who assumed leadership of DOT weeks before the audit was released, told lawmakers in February that it shows a need to “change the culture” in DOT.